Governmental Taxation of Households Choosing between a National Currency and a Cryptocurrency

A game between a representative household and government was analyzed. The chose which fractions of two currencies to hold, e.g., national currency such as Central Bank Digital Currency (CBDC) global Bitcoin or Facebook’s Diem, the tax evasion probability for each currency. chose, currency, detecting prosecuting evasion, rate, penalty factor imposed on when successfully detected prosecuted. household′s fraction government’s monitoring increased in Cobb Douglas output elasticity probabilities both taxation decreased High eventually induced that more than less (more) likely evade (global) if valued results are illustrated numerically where eight parameter values varied relative benchmark.