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An Early Stablecoin? The Bank of Amsterdam and the Governance

  • Series
    ACLE Law & Economics Seminars
  • Speaker
    Peter Wierts (Vrije Universiteit Amsterdam)
  • Field
  • Location
    hybrid event; online and at the University of Amsterdam, Roeterseiland
  • Date and time

    September 21, 2021
    12:00 - 13:30

This paper draws lessons on the central bank underpinnings of money from the rise and fall of the Bank of Amsterdam (1609-1820). The Bank started out as a "stablecoin": it issued deposits backed by silver and gold coins, and settled payments by transfers across deposits. Over time, it performed functions of a modern central bank and its deposits took on attributes of fiat money. The economic shocks of the 1780s, large-scale lending and lack of fiscal support led to its failure. Using monthly balance sheet data, we show how confidence in Bank money gave way to a run equilibrium, where the fall of the premium on deposits over coins ("agio") into negative territory was swift and precipitous. This holds lessons for the governance of digital money.

This event will be a hybrid event. (Note: Subject to change due to Covid-19 government or UvA measures). The zoom link will be specified in the registration confirmation email upon registration for the event. Room information will be indicated by email upon registration. In-person places will be limited, and will be allocated on a first-come-first-serve basis. If you would like to join in person on Roeterseiland campus, please email acle(at)uva.nl. In-person places cannot be guaranteed.

Register here to join online.