Dynamic Analysis of the Impact of Digital Currency on Currency Multipliers

Digital currency is another revolution in the form of currency, greatly changing the business model of traditional finance and having an impact on the monetary multiplier generated in monetary policy transmission. This article is based on quarterly data from 2015 to 2022, using Granger causality test and Johansen cointegration test, and using the VEC model for error correction. The results indicate that in the short term, digital currencies exacerbate the volatility of currency multipliers; After a very lengthy period of time, the rate of increase in size per unit time digital currency (GEM) is positively correlated with the currency multiplier, and digital currency can maintain an equilibrium in the currency multiplier.