Strategic Literature Review of the Impact of Digital Currency on Traditional Banking

Cryptocurrencies and central bank digital currencies (CBDCs) are two examples of digital currencies that are quickly taking over the financial landscape. This article explores the disruptive implications of digital currency on conventional banking institutions, paying special emphasis to significant subjects including regulatory concerns, financial intermediation, monetary policy, and transaction efficiency. By examining case studies and current affairs, this study illustrates how digital currencies both present opportunities for innovation and challenge the role of traditional banks as financial intermediaries. In order to assess potential modifications and long-term impacts, the study also examines the responses of banks and regulatory bodies to this shift. The findings suggest that while digital currencies pose significant challenges to the current banking system, they also promote technological advancement and financial inclusion, necessitating a fundamental change in the banking sector.