Consumer choices under new payment methods

Abstract This study suggests a payment portfolio model that includes new methods have emerged from the development of cryptocurrency markets and central bank digital currencies (CBDCs). Our analyzes optimal choice for consumers under various macroeconomic conditions. We determine an individual economic agent chooses specific conditions by incorporating policy interest rates on CBDCs stablecoins used exchanges. analyze impacts whether to use cash or deposits. also examine how changes her compositions in response exogenous policies. If government replaces with CBDC, convenience currency would not affect consumer choices. The higher government’s rate CBDCs, more will than