This paper presents a new approach for modelling the connectedness between asset returns. We adapt measure of Diebold and Yilmaz, which is based on forecast error variance decomposition VAR model. However, their hinges critical assumptions with regard to variance–covariance matrix terms. propose use more agnostic empirical approach, machine learning algorithm, identify contemporaneous structure...

The paper aims to assess, from an empirical viewpoint, the advantages of a stablecoin whose value is derived basket underlying currencies, against which pegged one major currency, such as dollar. To this aim, we first find optimal weights currencies that can comprise our basket. We then employ volatility spillover decomposition methods understand foreign currency mostly drives others. look at h...

In the past year there have been some sharp movements in exchange rates, involving substantial depreciation of a number of East␣ Asian currencies and an appreciation of the US dollar against other major currencies. The Australian dollar has declined against the US␣ dollar, but has appreciated substantially on average against the East Asian currencies. The economic turmoil in East Asia will affe...

While in principle, international payments could be carried out using any currency or set of currencies, in practice, the US dollar is predominant in international trade and financial flows. The dollar acts as a ‘vehicle currency’ in the sense that agents in non-dollar economies will generally engage in currency trade indirectly using the US dollar rather than using direct bilateral trade among...

A large collection of daily time series for 60 world currencies’ exchange rates is considered. The correlation matrices are calculated and the corresponding Minimal Spanning Tree (MST) graphs are constructed for each of those currencies used as reference for the remaining ones. It is shown that multiplicity of the MST graphs’ nodes to a good approximation develops a power like, scale free distr...

Although recent data on electronic commerce (e-commerce) shows vital growth, the role of electronic money in e-commerce is still unclear. Critical success factors for electronic money found in the literature are briefly summarized with special focus on gold-backed forms of Internet-based payment systems. It is shown that the gold standard can be implemented as a currency regime not only for phy...