Tokenized Finance and Monetary Law: The Evolving Role of the Central Bank in the Age of Digital Currency

This thesis attempts to examine the motivations of the central bank and the state in the adoption of a sovereign-backed Central Bank Digital Currency (CBDC). We sought to answer the question- of what central bank roles will be most affected by the adoption of a sovereign-backed digital currency. Since any motivations for the adoption of this new form of currency are sure to reflect in its eventual design, we argue that without the intervention of the law at this crucial design stage, any such currency is very likely to be unfavorable to the money users. We justify this by investigating the role played by the law in guiding the evolutionary trajectory of the central bank and monetary affairs generally. Our investigation revealed that money and the law evolved alongside economic development and the inherent complexities in trade and exchange.