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Boston Fed releases report, source code of digital currency prototype study

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Re: Boston Fed releases report, source code of digital currency prototype study

#121

Post by dragonwriter »

wbsss4412 wrote: post #95
salawat wrote: post #87

Earlier quoted context omitted.

They never open the package, and technically, they are quasi-public. Public enough that they can't play fast and loose like everyone else, but private where it matters in terms of not having literal Federally administered databases all just eafer for the reaping.

The fed is quasi public too? It’s actually less public than the postal service, the postal service is a fully public agency, the fed is partially governed by private banks.

> the postal service is a fully public agency, the fed is partially governed by private banks.

The Fed is fully governed by a federal agency. (The Fed Board of Governors).

The individual regional Fed banks are private-public hybrids, but they don't govern the system.

Re: Boston Fed releases report, source code of digital currency prototype study

#122

Post by [deleted] »

rvense wrote: post #114
pessimizer wrote: post #77

Earlier quoted context omitted.

This is literally the only reason I support it. Banking, debit cards, and paypal are just private taxes.

Exactly. CBDC is not a response to cryptocurrencies. It is a (belated) response to the fact that the way cashless economies have evolved has basically privatized money-as-infrastructure. The privacy implications of CDBC are a real problem, but the rapidly approaching end game of the current slippery slope is one in which, among other things, all participation in the economy is gated entirely by private banks. No sove…

[deleted]

Re: Boston Fed releases report, source code of digital currency prototype study

#123

Post by wbsss4412 »

dragonwriter wrote: post #121
wbsss4412 wrote: post #95

Earlier quoted context omitted.

The fed is quasi public too? It’s actually less public than the postal service, the postal service is a fully public agency, the fed is partially governed by private banks.

> the postal service is a fully public agency, the fed is partially governed by private banks. The Fed is fully governed by a federal agency. (The Fed Board of Governors). The individual regional Fed banks are private-public hybrids, but they don't govern the system.

Nonetheless, given that the individual regional banks are have directors that are elected by the member banks, control over certain levels of fed policy are in a sense private, whereas that is nowhere true for the postal service. At least not to my knowledge.

Re: Boston Fed releases report, source code of digital currency prototype study

#124

Post by notahacker »

nabla9 wrote: post #26

Central bank digital currency efforts seem interesting. 1. They make it possible to deliver helicopter money directly to the consumers. Now central banks can only work trough banks or financial markets. Digital currency where everyone has access to central bank money can correct the errors in current systems. 2. Currency would be anchored in real economy with sound monetary policy. Nobody in their right mind takes Bi…

Helicopter money has always been theoretically possible to deliver direct to [most] consumers, with a bit of help from authorities responsible for tax/benefits/pensions, albeit somewhat inefficiently. But half the problem of monetary policy (the more relevant half in the immediate future) is reducing the money in the system when inflationary pressure is high. That's where channelling monetary policy through changes in the interest rate starts to make sense (the reduction is a natural one as people and corporations borrow less, which is a lot less politically painful than withdrawing a direct subsidy or even debiting people's accounts)

Re: Boston Fed releases report, source code of digital currency prototype study

#125

Post by mjevans »

ur-whale wrote: post #27
mjevans wrote: post #7

The mention of blockchain in the summary worries me. We have real world data that shows us this only leads to wasted electricity and fabricated silicon shortages/outrageously expensive computer hardware. The idea of a public ledger and distributed witness signatures is sound though, and that should be the basis of a government approved system of inter-reserve asset tracking.

> We have real world data that shows us this only leads to wasted electricity You are either ill-informed and should educate yourself on the subject (blockchain != proof of work-based consensus) or willingly creating confusion by mixing up concepts. Let's assume the first, shall we?

You're correct that I'm not an expert in the terminology used in this field. Surely I'm not the only one who hears "blockchain" and thinks it must be like Bitcoin and other proof of work crypto currencies?

Maybe the summary is saying something completely different, in which case the use of 'blockchain' within it can still concern me and any other readers who are similarly wrongly informed.

Re: Boston Fed releases report, source code of digital currency prototype study

#126

Post by jt2190 »

triangleman wrote: post #66
beefman wrote: post #44

"In our design users interact with a central transaction processor using digital wallets storing cryptographic keys. ... Despite using ideas from blockchain technology, we found that a distributed ledger operating under the jurisdiction of different actors was not needed to achieve our goals. Specifically, a distributed ledger does not match the trust assumptions in Project Hamilton's approach, which assumes that the…

Reading Matt Levine's latest column on this CBDC was sort of mind blowing. With a truly centralized digital currency the Fed would basically monopolize all bank deposits (why store money in the bank at all when your digital wallet is perfectly safe) and destroy the entire banking sector. So they are forced to decentralize the currency to some extent, so that banks are the ones to actually issue the currency (after bo…

I think you’re talking about his column from Tuesday [1], which talks about different research at the Fed [2] that suggested that there is a trade off between “credit provision” (i.e. private lenders taking a risk and extending credit to their customers who they have relationships with) and “stability”. In a credit crunch, investors could flee to a CBDC and make the crisis worse.

[1] “The Fed vs. Stablecoins” https://www.bloomberg.com/opinion/articles/2022-02-01/hedge-...

[2] “Stablecoins: Growth Potential and Impact on Banking” https://www.federalreserve.gov/econres/ifdp/stablecoins-grow...

Re: Boston Fed releases report, source code of digital currency prototype study

#127

Post by Trias11 »

DennisP wrote: post #60
beefman wrote: post #44

"In our design users interact with a central transaction processor using digital wallets storing cryptographic keys. ... Despite using ideas from blockchain technology, we found that a distributed ledger operating under the jurisdiction of different actors was not needed to achieve our goals. Specifically, a distributed ledger does not match the trust assumptions in Project Hamilton's approach, which assumes that the…

This doesn't sound all that different from the banking system we have now.

They don't need much of a difference. Just more control.

Re: Boston Fed releases report, source code of digital currency prototype study

#128

Post by uncletammy »

tantalor wrote: post #104
_-david-_ wrote: post #86

Will this basically mean the federal government would have a record of all our transactions?

It depends on how Congress writes the law that would enable CDBC. They could simply copy & paste the existing laws regarding banking privacy, e.g., RFPA. https://en.wikipedia.org/wiki/Right_to_Financial_Privacy_Act

As if the FISA courts wouldn't be employed to circumvent any constraints placed on the system by congress.

Re: Boston Fed releases report, source code of digital currency prototype study

#129

Post by uncletammy »

6gvONxR4sf7o wrote: post #74
ur-whale wrote: post #37

Many people on HN claim that the rise of crypto-currencies is a social catastrophe. Maybe so (I disagree), but wait until central-bank issued digital currencies become a reality, you'll very quickly learn the real meaning of social catastrophe. Spending 10 seconds thinking about it, I can come up with the following scenarios: - complete and utter "financial deplatforming" if you don't behave as a citizen. This is bas…

> complete and utter "financial deplatforming" if you don't behave as a citizen. We live in a world with prisons. Stopping your spending is nothing compared to literally locking you up.

"Locking you up" would cost a hell of a lot more money than simply updating your `isBlacklisted` field in a database entry. The latter could be done for every citizen at negligible cost.

Re: Boston Fed releases report, source code of digital currency prototype study

#130

Post by notch656a »

brimble wrote: post #93
ur-whale wrote: post #59

Earlier quoted context omitted.

> What does civilians owning firearms have to do with a well-trained military force taking over the seats of power? Such a military force would be facing a very well armed citizen-led guerilla response. Given the amount of private gun ownership in the US, holding on to power after a coup would prove a rather difficult proposition.

I haven't seen any real-world evidence that high levels of individual firearm ownership correlate with the preservation of liberty and democracy. Most examples people like to bring out are resistance to a foreign occupation, typically with external assistance from a real military and/or shipments of military arms. And, perhaps tellingly, the result after the occupiers leave is rarely democracy. Meanwhile improvised b…

>I haven't seen any real-world evidence that high levels of individual firearm ownership correlate with the preservation of liberty and democracy.

Kurds in Northern Syria.

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