The Impact of Digital Currencies on Traditional Banking: A Comparative Study of Emerging Markets

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Dipti Sharma, Sovik Mukherjee, Renuka Deshmukh, RVS Praveen, Biswo Ranjan Mishra, Bhadrappa Haralayya

Abstract

The advent of digital currencies, including cryptocurrencies and central bank digital currencies (CBDCs), is reshaping the financial landscape. This research paper explores the impact of digital currencies on traditional banking systems, with a particular focus on emerging markets. Emerging economies often face unique challenges such as financial inclusion, inflation, and currency instability, which digital currencies aim to address. This study compares the adoption and integration of digital currencies in select emerging markets, examining their effects on banking operations, monetary policy, financial stability, and economic growth. By analyzing both opportunities and risks, the paper provides a comprehensive assessment of how digital currencies are transforming the banking sector, their role in enhancing financial inclusion, and the regulatory challenges that accompany their use. The findings suggest that while digital currencies offer significant advantages in terms of financial inclusion and efficiency, their implementation must be carefully managed to mitigate risks to financial stability and ensure equitable access.

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How to Cite
Dipti Sharma, Sovik Mukherjee, Renuka Deshmukh, RVS Praveen, Biswo Ranjan Mishra, Bhadrappa Haralayya. (2025). The Impact of Digital Currencies on Traditional Banking: A Comparative Study of Emerging Markets. European Economic Letters (EEL), 15(1), 1013–1025. https://doi.org/10.52783/eel.v15i1.2483
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