New Research on Distributed Ledgers & Money Governance. A recent Journal of Financial Economics (JFE) paper by Cyril Monnet & Hyun Song Shin explores the economic case for decentralization in monetary systems. Key insights: 🔹 Decentralization benefits systems where validators are also users, aligning incentives. 🔹 Challenges include higher validation costs and consensus difficulties. 🔹 Centralization is optimal when long-term rewards are high, but decentralization prevails when intertemporal incentives are weaker. 🔹 Findings apply to anonymous vs. identified systems, permissioned vs. permissionless access, and monopolistic vs. competitive ledgers. Read the full paper for a deep dive into decentralized finance.