New Zealand Might Launch Its Own Digital Currency (yahoo.com) 36
"New Zealand's central bank is exploring the possibility of issuing a digital currency, saying the benefits it would bring include its potential use as a monetary policy tool," reports Bloomberg. The central bank cites "the declining use, acceptance and availability of cash in New Zealand, and emerging innovations in private money, namely stablecoins."
While developing a central bank digital currency would require long lead times given the complexities and involve a multi-stage approach, the Royal Bank of New Zealand (RBNZ) said it broadly favors the idea. A digital currency should support the New Zealand dollar "as our single unit of account" and be exchanged 1-for-1 with cash, it said, adding "cash is here to stay for as long as some of us need it."
The RBNZ said a digital currency would support the value anchor role of central bank money by:
- Providing individuals and businesses with the option of converting privately issued money into a digital form of central bank money, ensuring the long-term convertibility of private money into central bank money
- Improving the technological form of central bank money to ensure it remains relevant in a digital future
- Providing an additional monetary policy tool by it being either issued to provide monetary stimulus, or interest bearing....
Other central banks around the world, including the European Central Bank, are also exploring the possibility of issuing a digital currency.
The RBNZ said a digital currency would support the value anchor role of central bank money by:
- Providing individuals and businesses with the option of converting privately issued money into a digital form of central bank money, ensuring the long-term convertibility of private money into central bank money
- Improving the technological form of central bank money to ensure it remains relevant in a digital future
- Providing an additional monetary policy tool by it being either issued to provide monetary stimulus, or interest bearing....
Other central banks around the world, including the European Central Bank, are also exploring the possibility of issuing a digital currency.
Privately issued money? (Score:2)
Providing individuals and businesses with the option of converting privately issued money into a digital form of central bank money, ensuring the long-term convertibility of private money into central bank money
Not sure what "Privately issued money" they are converting to and from? Some sort of company scripts or bartering tokens?
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I think they're just referring to privately owned banks being the distribution channel for physical notes and coins.
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I think they're just referring to privately owned banks being the distribution channel for physical notes and coins.
I'll have to take that back, from TFA "emerging innovations in private money, namely stablecoins"
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Re: Privately issued money? (Score:2)
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I never really understood the point of governments issuing their own crypto. The whole point of crypto was to have a method of currency that was independent of the problems government currencies bring such as lack of privacy, quantitive easing (printing more at your expense), and transaction fees. Stable coins and government run crypto is a solution looking for a problem because it doesnt address the actual problems bitcoin was founded to solve.
I don't think the aim of central banks is to solve the problems bitcoin was founded to solve but rather to solve their own problems. The Swedish central bank (riksbank) has done a number of reports on the subject since 2017 (in english) https://www.riksbank.se/en-gb/... [riksbank.se] Currently their focus seems to be a token based currency and the benefits of being able to bypass banks.
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Private banks generate the bulk of the money in the economy, not the central bank. Let's say you have found a magic rock. You want to sell it to me, and I want to buy it. We think it is worth $1 million. As long as we can convince the bank that it is indeed worth $1 million, then I can get a loan from the bank to buy it. This results in a negative balance in my bank account (the loan I took out), and a positive balance in your account (the payment for the magic rock). You now have $1 million that did not ex
Re: Privately issued money? (Score:2)
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They are referring to Bitcoin, Ethereum, Dogecoin and the other non-governmental crypto currencies.
Re: If the source code isn't open (Score:3)
It depends on service, banks will often indemnify you for fraud outside of your control. In the past with skimming for instance, in the future it could be a zero click zero day. I prefer getting my money back with a closed source app over losing all my shit with an open source one.
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The Royal Bank of New Zealand? (Score:4, Informative)
I am in New Zealand and I have never heard about the Royal Bank of New Zealand. There's the BNZ (Bank of New Zealand), but the article mentions the Reserve Bank, so I think it is referring to the Reserve Bank of New Zealand. The Reserve Bank of New Zealand is similar to the Federal Reserve in the United States but the Reserve Bank of New Zealand does not have any private owners.
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If its pegged 1-1 against the dollar... (Score:2)
... then it essentially IS the new zealand dollar in a digital form so how is this any different to the way money has been transferred and used digitally for at least the last 30 years? Right now in the UK I can pay for (almost) everything either online or using a card , I don't have to go near any physical money so what does this bring to the table if its not a speculation vehicle such as bitcoin?
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"that's why cash must never disappear"
Unfortunately bank/corporate shills and politicians are trying to make that happen because for the former it means lower costs from not having to deal with physical money and for the latter it means full control (albeit indirectly via the banks) of the flow of money.
Re: If its pegged 1-1 against the dollar... (Score:2)
The state already has sovereign control over everything in their borders, with appropriate laws they can censor anything they want. Private payment processors (except banks) go far beyond the law to censor.
Private censorship is almost always a subset of government censorship inside a nation, often worse, rarely better.
Re: If its pegged 1-1 against the dollar... (Score:2)
Oops, meant superset.
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So the answer to the original poster's question is that this is still the New Zealand Dollar? They aren't creating a new currency, just a government supported way for people to transfer money electronically without going through a private company?
Re: If its pegged 1-1 against the dollar... (Score:3)
Most countries don't have a convenient, uncensored digital money transfer system.
SEPA is uncensored but not convenient. No mandate for standardized support for initiating payments requests on the Web, not even through the QR code. Zelle, paypal and credit cards are all censored (beyond legal necessity).
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You would probably lose the untraceability of cash transactions.
The open question is how useful that is to the private citizen.
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... then it essentially IS the new zealand dollar in a digital form so how is this any different to the way money has been transferred and used digitally for at least the last 30 years? Right now in the UK I can pay for (almost) everything either online or using a card , I don't have to go near any physical money so what does this bring to the table if its not a speculation vehicle such as bitcoin?
The money you have on your card is an IOU from the bank. They pinky promised to give you the money bank when you ask for it, but if you remember what happened with Northern Rock they are not always able to deliver on that promise. Indeed, if everyone tried to take their money out of any bank at the same time, that bank would collapse (these days resulting in a haircut for depositors).
A central bank digital coin is like cash. You possess it. If all the banks fall over, you can still use your coins to buy and
The Difference (Score:1)
then it essentially IS the new zealand dollar in a digital form so how is this any different to the way money has been transferred and used digitally for at least the last 30 years?
A lot of commenters seem to think this digital currency is somehow magically more "real" than fiat but don't explain how.
Let me instead list out the actual differences, true of all digital currencies being considered by central banks around the world:
1) Can have a "spend by" date attached, so that you do not sit on money for too
There's a lot of pegging going on.... (Score:1)
I'm not sure they need to. (Score:2)
That's why Rocket Lab is there (Score:2)
Its the RESERVE Bank of New Zealand not the Royal (Score:1)
So awesome the rest of western world gets to watch (Score:2)
New Zealand and Australia beta test the new world order. No one can leave the countries, no one can go outside their house without permission even if starving. Now they will get their money confiscated if they are naughty on social media or get arrested randomly years later if they contribute money to the current politically or socially 'wrong' causes.
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