From Bitcoin to Stablecoins and their Contribution to the Monetary Landscape: The Case of Lugano’s Plan ₿

Abstract

The present contribution explores – for the first time in economic literature – the monetary experiment called Lugano’s Plan ₿ and conducted by the City of Lugano (Switzerland) since March 2022 consisting of a public-private partnership with a global player in the stablecoin market such as Tether. In addition to stimulating a vivacious public debate about payment methods and fostering educational initiatives, the City of Lugano has created LVGA, a local payment token based on blockchain technology, which represents de facto a stablecoin pegged to the Swiss franc. The present case study provides further insights into the local experience of Lugano and might represent an example of “best practices” to be further explored by the economic literature in the future.