Maybe I don't have enough imagination, but what are the realistic benefits of this compared to USD or existing cryptocurrencies? It seems like this would combine some of the worst features of each to make something that no one is happy with.
US Digital Currency
21–30 of 139 posts
Re: US Digital Currency
#22>Ideally the initial coins would be evenly distributed to US citizens and taxpayers— [...] The government can likely create a lot of de novo wealth for its citizens in the process. This USDC proposal seems to reiterate the same themes as a previous blog post "American Equity".[1] >, but I think the network needs to be mostly in charge (e.g., the government couldn’t be allowed to arbitrarily inflate the currency when…
Social Security in the U.S. is inflation-adjusted.
The government also controls the COLA Cost of Living Adjustment. Ask retirees if they feel the modest COLA increases have kept up with real expenses.
Re: US Digital Currency
#23As others have already commented, existing currencies are already "digital". On my most recent trip abroad (to Copenhagen) I took some physical currency, and didn't use it at all.
Every transaction was digital and instantaneous (I use a Monzo Mastercard). I got a smartphone notification within 5 seconds of having approved the transaction.
The original promise of "cryptocurrencies" appeared, to me, to be decentralization, not their digital nature. The idea that a currency could be free from the control of a given government or set of governments.
This premise doesn't seem to have held for most current cryptocurrencies, as the prevalence of exchanges as central points of control has just led to governments targeting them to get the information they need to apply things like taxation and money laundering controls.
Re: US Digital Currency
#24[deleted]
Re: US Digital Currency
#25What is this... jotting down some notes? I guess this will generate discussion because Sam wrote it, but it is probably one of the most boring and banal ideas in the space. And the exposition is very... shallow to say the least. "A tricky part of this would be how to balance letting the network have control over itself and letting the government have some special degree of input on ‘monetary policy’. It’s certainly o…
Yes, seems more like a discussion starter to me. And that’s OK and perfectly acceptable. Whereas, your comment comes off as an overly critical meaningful discussion diverter. Better not to say anything at all. Now, I’d better follow my own advice.
Re: US Digital Currency
#26How would this be better than what we have now? If the answer is "cryptocurrency increases in value," I can assure you that's a terrible reason.
Cryptocurrency is slower than card networks. It's more expensive than practically any other way of sending money. And as far as scale goes, it would need to become orders of magnitude more efficient to handle even a small percentage of consumer transactions. After all, what's the point of a cryptocurrency if the only people who can host the full blockchain (or even acquire the full blockchain) are large banks and the government? I.e., where do you even get an internet connection that can accept, in near realtime, a full record of every monetary transaction performed with such a currency? Unlike card networks, every member of the network needs to process every transaction eventually.
I don't think cryptocurrency is at the point where the scalability concerns can be addressed to be used as legal tender for an economy as large as the US.
If this is meant to replace bonds or other government issued securities, what problem is it solving? I can't think of one.
Re: US Digital Currency
#27What is this... jotting down some notes? I guess this will generate discussion because Sam wrote it, but it is probably one of the most boring and banal ideas in the space. And the exposition is very... shallow to say the least. "A tricky part of this would be how to balance letting the network have control over itself and letting the government have some special degree of input on ‘monetary policy’. It’s certainly o…
"The "government" can't "arbitrarily inflate the currency"." The US government can literally do this. They can print as much money as they feel like. It would be 'dumb' for sure, but the US treasury is indeed allowed to do this. There was even talks of solving the national debt crisis by having Obama create a trillion dollar coin a couple years ago.
I think he was positing that they couldn't inflate in a future world of a GovCoin.
There is actually an interesting nugget in the Obama idea. The "trillion dollar coin" thing completely misunderstands market dynamics, but the idea of the Executive taking power back from The Federal Reserve is interesting.
Re: US Digital Currency
#28>Ideally the initial coins would be evenly distributed to US citizens and taxpayers— [...] The government can likely create a lot of de novo wealth for its citizens in the process. This USDC proposal seems to reiterate the same themes as a previous blog post "American Equity".[1] >, but I think the network needs to be mostly in charge (e.g., the government couldn’t be allowed to arbitrarily inflate the currency when…
Social Security in the U.S. is inflation-adjusted.
against a benchmark formula derived by the same US govt that can print more money. There has also long been discussion that the existing inflation measures are inaccurate [0].
https://www.bloomberg.com/news/articles/2018-05-02/the-consu...
Re: US Digital Currency
#29[deleted]
Re: US Digital Currency
#30I used to work in payments in the public sector.
The Fed generates ~$90 BN of revenue for the US government every year.
And it does it by printing physical cash. I think the first step to traction would be convincing Congress that they can get by without $90 BN every year. (Edit: if they haven't already been convinced).