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Bank of England to explore a potential Central Bank Digital Currency

bankofengland.co.uk

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Re: Bank of England to explore a potential Central Bank Digital Currency

#51

Post by Broken_Hippo »

mytailorisrich wrote: post #48
KaiserPro wrote: post #30

I've not really understood the need for a "digital" pound, the pound is pretty digital already. I can already have an entirely digital bank account from at least three "challenger" banks. There are also now at least two business accounts that also entirely virtual. "Faster Payments" (customer bank transfers) are delivered in seconds. I can see a need for speeding up BACS, and reducing the price of CHAPS, but apart fr…

Currency is not digital. What they mean by "digital currency" is a for instance a purely digital bank note than you can hold and transfer to someone else (like for instance a crypto token). Clearly that's not how things work now. Edit: See my further comment below as it looks like people don't quite understand what "digital currency" is.

So, it'll do a thing I can already do with money?

Re: Bank of England to explore a potential Central Bank Digital Currency

#52

Post by Broken_Hippo »

veritascap wrote: post #41
KaiserPro wrote: post #30

I've not really understood the need for a "digital" pound, the pound is pretty digital already. I can already have an entirely digital bank account from at least three "challenger" banks. There are also now at least two business accounts that also entirely virtual. "Faster Payments" (customer bank transfers) are delivered in seconds. I can see a need for speeding up BACS, and reducing the price of CHAPS, but apart fr…

The reason for a CBDC are new features. Money that can be programmed to only be used in certain ways, with certain groups, or at certain times, e.g. expiring money. It’s more nudging power for our unelected technocrat dear leaders. Imagine the possibilities!

So, less functional money? More complicated gift card?

Re: Bank of England to explore a potential Central Bank Digital Currency

#53

Post by KaiserPro »

xwolfi wrote: post #37
KaiserPro wrote: post #30

I've not really understood the need for a "digital" pound, the pound is pretty digital already. I can already have an entirely digital bank account from at least three "challenger" banks. There are also now at least two business accounts that also entirely virtual. "Faster Payments" (customer bank transfers) are delivered in seconds. I can see a need for speeding up BACS, and reducing the price of CHAPS, but apart fr…

A normal citizen is never gonna build a government that allows for anonymous payment systems. To often people speak of their government as completely abstract separated entity they can only submit to. But actually, they elect them and the government even follow them in their craziest follies, like, say, leaving the EU in the UK.

> To often people speak of their government as completely abstract separated entity they can only submit to.

it is a compromise. I don't want to live in anarchy (sorry, a libertarian world) because like extreme communism it has inherent flaws. Thus I submit to being ruled by the UK government, and actively vote in elections. However as its a compromise, no present party with a chance of winning power reflects my views, thus compromise.

However to your main point. Anonymous easy payments are a vector for corruption, crime and general bad stuff. Sure there are good usecases for it, but mostly it'll be used to avoid tax.

Re: Bank of England to explore a potential Central Bank Digital Currency

#54

Post by bitcoinmonger »

KaiserPro wrote: post #49
bitcoinmonger wrote: post #40

Earlier quoted context omitted.

This will be good for anyone interested in using modern cryptocurrencies, whilst also allowing governments to control access to accounts and adjust the money supply if necessary. It's a win-win for everyone. Also the energy required to secure the ledger will be dramatically reduced. Proof of work can be replaced by physical security, which is more energy efficient. Anyone wanting to rewrite the ledger would need more…

> Proof of work can be replaced by physical security, which is more energy efficient. I'm not sure you understand how banking works. The BoE already has a ledger, its just private[1] for a number of reason (the banks accounts are published, but not in real time, and not by individual account). All banks have ledgers, and sometimes they even marry up. [1]well kind of.

What would happen if you walked in to their server room and tried to update their database to reverse a payment?

Re: Bank of England to explore a potential Central Bank Digital Currency

#55

Post by SideburnsOfDoom »

KaiserPro wrote: post #30

I've not really understood the need for a "digital" pound, the pound is pretty digital already. I can already have an entirely digital bank account from at least three "challenger" banks. There are also now at least two business accounts that also entirely virtual. "Faster Payments" (customer bank transfers) are delivered in seconds. I can see a need for speeding up BACS, and reducing the price of CHAPS, but apart fr…

> the pound is pretty digital already.

What you didn't mention is that it's also already pretty digital at point of sale as well; Contactless payment, i.e. "card taps" are very common.

Re: Bank of England to explore a potential Central Bank Digital Currency

#56

Post by razius »

bitcoinmonger wrote: post #42
Nursie wrote: post #14

Earlier quoted context omitted.

Just no. Hard money is not desirable. Whatever comes out of this "the country's money supply should be determined by some cryptobros" is not going to be the result.

Agreed. The money supply should be flexible to help alleviate the effects of inevitable financial crashes. This of course devalues the savings of the average person when this happens, but it's the only way to recover from mistakes like the mortgage bubble.

Mortgage bubbles don't appear out of thin air, it's a debt bubble. Why does a saver have to pay for debtors?

Re: Bank of England to explore a potential Central Bank Digital Currency

#57

Post by KaiserPro »

mytailorisrich wrote: post #48
KaiserPro wrote: post #30

I've not really understood the need for a "digital" pound, the pound is pretty digital already. I can already have an entirely digital bank account from at least three "challenger" banks. There are also now at least two business accounts that also entirely virtual. "Faster Payments" (customer bank transfers) are delivered in seconds. I can see a need for speeding up BACS, and reducing the price of CHAPS, but apart fr…

Currency is not digital. What they mean by "digital currency" is a for instance a purely digital bank note than you can hold and transfer to someone else (like for instance a crypto token). Clearly that's not how things work now. Edit: See my further comment below as it looks like people don't quite understand what "digital currency" is.

That's literally how the BoE works.

when you do a bank transfer, do you think they physical cash?

When the BoE does quantitative easing, they don't actually print money[1], they just "transfer" money to banks who then do "things" with it. Its literally just numbers in a DB.

[1] handling physical cash is expensive, slow and difficult. Not only is the price of movement relatively static regardless of the value, you have to keep on paying to store the stuff. The Federal reserve do things differently I think, because are not quite as all in one as the BoE.

Re: Bank of England to explore a potential Central Bank Digital Currency

#58

Post by aseerdbnarng »

What I believe the BOE is exploring is for each citizen to have an account with the BOE and the potential for the types of money that can be used in this parallel banking system.

If we think of the financial system as plumbing, the central bank has direct pipes to banks but rarely to citizens. This is not usually a problem except when you need to do a big emergency stimulus push not having direct pipes to individuals means stimulus takes a long time to reach individuals (if it does at all). Even countries like the USA and UK had a challenge rolling out stimulus, so this is a mechanism to bypass traditional banking system in a crisis.

Thats just the banking aspect, the interesting stuff is what you can do with the type of money issued. For example you can build inflation into the currency, to encourage the user to spend it. Or it can be tied to carbon credits as a way to encourage the purchase of environmentally friendly products. I am not saying this is what is going to happen, only that a digital currency directly issued by a central bank has the potential to be used in ways that is not readily possible right now.

Re: Bank of England to explore a potential Central Bank Digital Currency

#59

Post by scrollaway »

bitcoinmonger wrote: post #54
KaiserPro wrote: post #49

Earlier quoted context omitted.

> Proof of work can be replaced by physical security, which is more energy efficient. I'm not sure you understand how banking works. The BoE already has a ledger, its just private[1] for a number of reason (the banks accounts are published, but not in real time, and not by individual account). All banks have ledgers, and sometimes they even marry up. [1]well kind of.

What would happen if you walked in to their server room and tried to update their database to reverse a payment?

Simply, "It doesn't work like that". Very similar to how you can't just "hack bitcoin and change your wallet value". At best you can use your web inspector to add zeroes to your balance.

Transactions in ledger-based accounting require a source and target account. In double-entry, all transaction legs have to sum to zero. "$10 on Paul; -$10 on Alice."

Your "current balance" may be cached, but it's never used. Most financial systems (which I suspect extends to banks, but I could be wrong) will enforce recalculation of at least the tip of the account's ledger whenever a transaction comes out of it. You don't just add/substract from a cached number.

Re: Bank of England to explore a potential Central Bank Digital Currency

#60

Post by casi18 »

RichEO wrote: post #28
casi18 wrote: post #23

Earlier quoted context omitted.

I get the "anti-crypto-bro" sentiments, but Ive trusted the FOSS/linux communities for long enough to have open and auditable tech and clear decision making, it might not be perfect but it is a lot more transparent than my government. I'd pick the crypto-communities and thousands of people gaming them to design better mechanisms for the everyday people to use, than a few politicians and the banks that are bribing the…

I think you might be over estimating the overlap between the FOSS/Linux community and the crytobro community - at least as it exists in 2021

I think HN repeatedly underestimates the overlap of these communities. FOSS ideology is critical in pretty much all crypto/defi projects.I can probably pick any dev in the space and they'll most likely be running linux.

HN refuses to change its collective position it settled on a decade ago. It seems people here got stuck on some abstract projections of "crypto-capitalism-cruelty" and refuse to admit there might be something interesting going on.

Where did the "move fast and break things" people, the "disrupt the institutions" people, and the hackers go? crypto.

Or should we only be working on sass startups to reformat pdfs. is that what we're allowed to work on? everything else is a moral sin?

Utterly Bizarre.

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