Technological development plays an important role in society, and accordingly, digital currencies have emerged to be among the modern means of payment, as they have begun to take on the role of an alternative to traditional currencies, which makes them an important topic for discussion, and the extent of their impact on the size of the money supply. Cryptocurrencies have become part of the monetary mass. They are traded globally, and with these developments and the freedom to issue decentralized digital currencies that are not subject to the authority of the central bank, these currencies may have an impact on the global economy and the size of the money supply in particular. The objectives of this research are to distinguish between different types of digital currencies, as these currencies are considered among the recent changes that have not been studied extensively by researchers as well as to examine the extent to which digital currencies affect the size of the money supply and exploring the effect that caused by deferent types of digital currencies. The main goal of this study is to clarify the potential effects of digital currencies on financial stability and monetary policy and to explain their pros and cons. The descriptive analytical approach was adopted to determine the extent of the impact of these currencies on financial stability. One of the most prominent results reached is that the historical development of money does not mean the success of the current monetary system, but rather it is methods that adapt to what suits the requirements of the present and future, and the digital currencies issued by the Central Bank. Banks are the currencies that will maintain the position of the monetary authority represented by central banks, and there are negative and positive effects on economic variables in general and on financial stability in particular due to the use of digital currencies.