No one can ignore that we are entering it in the digital age. The perimeters of central banks are gradually starting to be crossed by the rise of crypto-assets. Especially since the new COVID-19 crisis offers an opportunity for Fintechs to impose themselves given the containment measures and social distancing. The question is asked for central banks, on the adoption of a digital currency for central banks, in order to centralize the system and ensure the safeguard of money for public confidence.
Christian P. Pinshi
Hi! Here are some articles that already give some ideas related to your question:
Fernández-Villaverde, J., Sanches, D., Schilling, L., & Uhlig, H. (2020). Central Bank Digital Currency: Central Banking For All? (No. w26753). National Bureau of Economic Research.
Fern, J., Sanches, D. R., Schilling, L., & Uhlig, H. (2020). Central Bank Digital Currency: Central Banking For All? (No. 2020-04).
Asadi, S. P. (2020). Central Bank Digital Currency and the Future of Commercial Banking. Available at SSRN 3542664.
I feel that this needs to be looked upon with caution.
This link:
Barontini, C., & Holden, H. (2019). Proceeding with caution-a survey on central bank digital currency. Proceeding with Caution-A Survey on Central Bank Digital Currency (January 8, 2019). BIS Paper, (101).
https://www.bis.org/publ/bppdf/bispap101.pdf
It concludes that at this time, the costs might outweigh the benefits and that caution and collaboration are the way forward (see pp 12-13).
However, I expect it will be the future, but how distant in the future?
I look at this development as keeping up with the times. Central Banks have to join the bandwagon if they don't want to be left out of the digital/fintech craze. Not too long ago, Central Bank has expanded their balances sheets to deal with Covid-19, following the footsteps of the Fed during the Global Financial Crisis in 2008. Where does this lead us? For most Central Banks, inflation is their ultimate goal and so long that this is not inflationary, then they can go along with it.
It is bad because it will be monitor by the digital server. The question is what is the reliability of the digital hub which will monitor the digital currency? If it will be hacked then will the data be restored? It is really dangerous.
Thank you very much to all, your interventions are so rich, and allows to deepen this question and to cooperate to find a consensus in the future
Remi Chukwudi Okeke I would tend to say that a globalized digital currency regime would involve blockchain technology and hence be decentralized, which means no need for central banks and financial institutions anymore (that why I don't really see how a digital currency could be monitored by central banks without just becoming a standard currency). A digitalized financial system could just be the digitalization of financial services thanks to new technologies, but not necessarily with the blockchain philosophy and technology (It would just be an improvement of the already existing system but not a paradigm shift).
I do not feel central banks will be interested in digital currency considering a huge population is still under-penetrated digitally. Perhaps some tech-savvy countries will start on a selective basis. Further, a single global currency will take several more decades to be a reality.
fiat currency would be diminishing, while digital currency would rising.
To maintain its authority in national currency, the central bank must develop its own CBDC.
Central bankers have stressed at the World Bank and IMF Annual Meetings the importance of carefully considering the costs and benefits of the Central Bank Digital Currency. For example, Powell noted that the US Federal Reserve takes a cautious approach and has yet to decide to launch a digital currency. He noted that aside from the benefits, some sensitive public policy and operational issues require careful assessment, including the risks of cyber attacks and the impact on monetary policy and financial stability. On the other hand, Mr. Alkholifey noted for his part that central bank digital currencies could help improve the resilience and efficiency of cross-border payments, and that Saudi Arabia has launched a pilot project with the United Arab Emirates to study in how modern technologies could help improve cross-border payments.
In this article we look at these issues, I hope you find it of interest.
Article Reasons Fostering or Discouraging the Implementation of Cent...
This is such an important question.
Digital currency can be both a blessing and a curse.
I endorse the decentralised currency, entered the crypto market for the massive digital trend, diversity, and potential.
However, the centralized digital money may not be in people's interest
1. can be linked to both an expiry date (experiments rolled out in China)
and tied to / conditioned on a behavioral score (opens the floodgates for totalitarian decisions). Regime critics / activists / investigative journalists (Snowden) ? No chance to even bu basic necessities any more.
2.Creates 100% transparent citizens (good bye privacy rights), with no handle on our own data.
3. Lagarde says it would supplement, but not replace CASH -
but look at all the promises that aren't worth a penny any more just a few weeks/months later, especially Europe/Germany.
Lagarde also argues,
In talks with consumers who answered in large numbers, Lagarde noted that many remarked, “We want our privacy to be safeguarded, but we don’t want anonymity because we realize the risk of anonymity.”
- Does this make sense to you? Citizens not care about anonymity? really?
At times, when they face ever more enforced restrictions, erosion of democracy, restricting basic human/constitutional rights, violations of the Nuremberg Codes?
4. Who needs a diversity of banks in the full-fletched CBDC scenario?
Does not sound like free markets any more. 100% of the population at the mercy of central banks/governments (do you agree with how they go about our health; then they also control our wealth?). Perfect insight and access to savings.
You don't want that.
Check our Catherine Austin-Fitts / Solari Report, former Housing & Urban Development Department, Financial Lead (White House) for her insider perspective (investment banking and finances, US government).
You will see that many of those globalised, digital control developments are already well underway.
University Southhampton: https://www.bitchute.com/video/geJkjtHd4Sw6/
"Central bankers want nothing short of a complete digital control system.”
NB: Carstens BIS
“..to establish equivalents in cash. Key difference of CBDC: Central Banks will have absolute control on the use. We will have the technology to e n f o r c e that.”
This is all but confidence building.
You may help to alleviate concerns(?)
You may know the video with Carstens, BIS General Manager, Oct 2020: https://marcowutzer.com/the-truth-about-central-bank-digital-currencies-and-the-future-of-money/…
P.S.: And if you don‘t play along, we can simply turn off your money.
#ErnstWolff #CatherineAustinFitts
https://home.solari.com/cash-friday/
Central banks are researching on this end for many years - Do they share their findings as you would expect it?
Scientists play an important role on your valid question.
