11–20 of 112 posts
Your transactions seem to be digital, but there are actually many complex systems and institutions involved to guarantee they're backed by real stuff that's actually worth something.
Digital currencies are all about removing this complexity.
Practically, it will make little or no difference to you. Currently, central banks manage money supply by managing currency transfers to commercial banks and via managing the amount of cash in circulation. The commercial bank transfers are (almost) all digital. Cash, obviously, isn't. There is reasonable reason to assume that cash will become less and less prevalent as digital payment flows become more ingrained. So…
> Practically, it will make little or no difference to you. So when the fed reserve decides inflation is too high because they printed too much money and kept interest rates low- instead of trying to "soften the labor market"/drive unemployment up and more people into poverty - with a digital currency, they can simply zap your money away. No need for financial "austerity" for the poor's to endure. What could go wrong…
Brazil did that in the 90s, digital currency wasn't needed.
Practically, it will make little or no difference to you. Currently, central banks manage money supply by managing currency transfers to commercial banks and via managing the amount of cash in circulation. The commercial bank transfers are (almost) all digital. Cash, obviously, isn't. There is reasonable reason to assume that cash will become less and less prevalent as digital payment flows become more ingrained. So…
> Practically, it will make little or no difference to you. So when the fed reserve decides inflation is too high because they printed too much money and kept interest rates low- instead of trying to "soften the labor market"/drive unemployment up and more people into poverty - with a digital currency, they can simply zap your money away. No need for financial "austerity" for the poor's to endure. What could go wrong…
Nothing stops them doing that with cash ie stopping extant currency being legal. Just happens that the US has never done that (to my knowledge). Other countries do it fairly regularly though.
I won't address your other points as they have nothing to do with digital currencies.
One goal of e-CNY is to be an alternative to USD payment systems like SWIFT which the Western governments hve used to enforced sanctions. China has a problem with the regular currency has a lot of restrictions on it. People can't just trade CNY for USD or something else because there are controls to prevent this. China wants e-CNY to be a platform for Chinese trade also third parties outside the USD umbrella, eg Braz…
Out of sight, out of mind. You don't see it but private transaction processors (Visa and Mastercard) consume up to 3% of the transaction amount. Over the course of a year, this amounts to $50 billion removed from the economy. The merchant pays this --- and passes the cost along to you in terms of higher prices.
The money transfer system that deposits your check is old and slow and involves human labor. Unless you pay additional fees (banks love fees), it takes at least 24 hours for the deposit to be made and the system only operates during "banker hours" --- 8-5 on weekdays; no weekends, holidays or nights.
A CDBC will be fully electronic/automated with instant results and operate 24/7/365 at insignificant cost. Basically, it will speed up and put billions of dollars back into the economy.
Despite all the doomsday misinformation, no one has suggested replacing cash or checks. And no, crypto is no substitute for what a CBDC will do.
https://www.economist.com/finance-and-economics/2022/09/05/t...
https://web.archive.org/web/20220909015725/https://www.econo...
Just as here on HN we read from time to time about people being locked out of various online services (i.e. Google, Facebook etc.) for doing something a company doesn't like, a CBDC would allow governments the ability to effectively lock people/organizations out of their digital economy.[1] It would also allow for money that expires and can only be used for certain (government approved) purposes. (these both would have been desirable from the government's point of view for COVID stimulus payments, for example)
[1] This can already be done to a degree via the banking system, but a CBDC would provide for much more granular control.
... mining is killing the planet, it's a big contributor. No we don't need more reasons to waste energy.