MIT/Federal Reserve Bank Release Research on a Possible Central Bank Digital Dollar (msn.com) 53
"The Federal Reserve Bank of Boston and the Massachusetts Institute of Technology's Digital Currency Initiative have come up with an initial design for a central bank digital currency," reports Yahoo Finance.
Reuters cautions that the newly-released research does not suggest that the U.S. central bank will move toward launching a CBDC, a step it has said it would not take without clear support from the White House and Congress...." Instead the team "developed technology that can be adjusted as more policy questions regarding the structure and purpose of a CBDC are addressed."
The Washington Post describes it as "a system that can settle the vast majority of payments in less than two seconds, handles more than 1.7 million transactions per second and operates around-the-clock with no service outages in the case of a disruption in its network."
The Boston Globe adds that "The team noted there's a lot more work to do in the next phase, including researching various privacy features, and stressed the digital dollar remains hypothetical until the Fed decides whether to move forward with government-backed electronic cash."
Some context from the Washington Post: The ultimate product could help extend financial services to people who lack a bank account and make cross-border payments such as remittances safer and easier, said Neha Narula, director of the Digital Currency Initiative at MIT. Narula, in a conference call with reporters, noted that the Boston researchers "aren't the ones making policy decision on how such a system might operate," so they have aimed to "create a flexible system that can work with a variety of models."
Along with a paper describing the team's work to date, researchers on Thursday published open-source code for the platform that would support the digital currency. Jim Cunha, executive vice president of the Boston Fed, called that a first for the central bank, intended to encourage public input that improves the technology.
Reuters cautions that the newly-released research does not suggest that the U.S. central bank will move toward launching a CBDC, a step it has said it would not take without clear support from the White House and Congress...." Instead the team "developed technology that can be adjusted as more policy questions regarding the structure and purpose of a CBDC are addressed."
The Washington Post describes it as "a system that can settle the vast majority of payments in less than two seconds, handles more than 1.7 million transactions per second and operates around-the-clock with no service outages in the case of a disruption in its network."
The Boston Globe adds that "The team noted there's a lot more work to do in the next phase, including researching various privacy features, and stressed the digital dollar remains hypothetical until the Fed decides whether to move forward with government-backed electronic cash."
Some context from the Washington Post: The ultimate product could help extend financial services to people who lack a bank account and make cross-border payments such as remittances safer and easier, said Neha Narula, director of the Digital Currency Initiative at MIT. Narula, in a conference call with reporters, noted that the Boston researchers "aren't the ones making policy decision on how such a system might operate," so they have aimed to "create a flexible system that can work with a variety of models."
Along with a paper describing the team's work to date, researchers on Thursday published open-source code for the platform that would support the digital currency. Jim Cunha, executive vice president of the Boston Fed, called that a first for the central bank, intended to encourage public input that improves the technology.
pot shops will need to take it! (Score:2)
pot shops will need to take it!
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Re: pot shops will need to take it! (Score:2)
So much for not one fact, you fucking goober. Also, what are the odds? Pretty high. Consider most people voted for him. Lastly, go fuck yourself. You let yourself be deceived
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Re: pot shops will need to take it! (Score:2)
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Without what is effectively borrowing without ever paying back, taxes will have to more then double to pay for Military spending and Social Security.
What a good argument for reduced spending on behalf of governments. Save, instead of paying taxes.
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A digital dollar will not solve the primary issue with Fiat currencies: an expanding supply that is given to the government on Congress's orders.
Fiat isn't supposed to be an investment. I could go on at length explaining why, but the song in Mary Poppins [youtube.com] is more fun.
If people could just toss all their money into a Scrooge McDuck-style vault and wait for it to go up in value, the economy would collapse. Banks need people to deposit money so they can lend it out, businesses need investors to provide capital, etc. Inflation is like a tax on not putting your money back to work in the economy.
And the government will build and run it? (Score:2)
The federal government has already spent all the tax funds they will collect for the next 20+ years. Wonder what they will pay the bills with next y
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the government can't even process the tax returns they demand from anyone.
A) most tax returns are still checked by hand, not digitally.
B) the IRS has had a downward slide in the number of people to process returns for the past twenty years. The previous administration explicitly went out of its way to get Congress to cut funding [thehill.com] so there would be fewer audits, especially when it comes to the 1%.
C) I'm still waiting on orders from last year from private industry. It will be a year in April.
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C) I'm still waiting on orders from last year from private industry. It will be a year in April.
Oh yeah. That's a legitimate gripe/strike against "private industry". Who shut down private industry? I'm really hoping that was sarcasm, else one has to question your intelligence.
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C) I'm still waiting on orders from last year from private industry. It will be a year in April.
Oh yeah. That's a legitimate gripe/strike against "private industry". Who shut down private industry?
I'm really hoping that was sarcasm, else one has to question your intelligence.
No one told private industry to cancel orders for chips. No one told private industry to cancel orders for products in general. No one told private industry to stop shipping containers across the Pacific. No one told private industry to have only two weeks of parts on hand.
Instead, what private industry was told was the taxpayer would, once again, cough up hundreds of billions of their dollars and have it handed over to private industry to keep it afloat because private industry is incapable of a) having
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No one told private industry to cancel orders for chips. No one told private industry to cancel orders for products in general. No one told private industry to stop shipping containers across the Pacific. No one told private industry to have only two weeks of parts on hand.
You're a goddamn liar. We were shut down under the threat of MASSIVE fines and possible jail time.
It's almost as if private industry isn't responsible. For anything.
I'm not even going to bother with you. You've got your head so far up your ass you can probably see daylight.
The Federal Reserve is where (Score:1)
Opinion (Score:1)
The issue I have with it is that it's centralized. The controlling entity can choose to stop processing transactions or reverse transactions. Even if the capability doesn't exist today, they can arbitrarily choose to add it in the future.
If I wanted the government to be able to blockade my ability to send or receive money, I'd use a traditional bank.
Nope.
Re: Opinion (Score:2)
But the Federal Reserve already is in charge of the supply of USD? If Congress declares this new thing accepted currency with the same faith and guarantees as USD than what's the real difference from a centralization standpoint?
Re: Opinion (Score:5, Insightful)
But the Federal Reserve already is in charge of the supply of USD? If Congress declares this new thing accepted currency with the same faith and guarantees as USD than what's the real difference from a centralization standpoint?
Right now I can take $1 out of my physical wallet and give it to someone without any 3rd party knowing about or being involved in the transaction. That's the difference.
Re: Opinion (Score:4, Insightful)
Today the Federal reserve and Congress cannot, by changing a row in a database, prevent me from transferring physical currency or take physical currency from me. This system would grant them that ability.
Fear that the government might misbehave with that power isn't a crazy conspiracy theory. In 2013 the DOJ made a concerted effort to block gun stores (and other undesirables) from banking services in Operation Chokepoint [wikipedia.org]. That program was eventually ended (with no admission of wrongdoing) but it took four years and drove many companies out of business. It's not a unique example. Legal and licensed marijuana dispensaries are still denied access to banking services today, and Wikileaks still has piles of money tied up in their banking blockade.
In light of the existing abuses, I'm unwilling to grant my government more control of currency transfers.
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Clarification: A centralized digital currency system would grant them the ability to remotely permit, block, or reverse transfers in a way impossible with physical currency or a decentralized cryptocurrency like Bitcoin.
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A federally backed digital currency doesn't prevent that either.
People (including me) like to shoot at quantitative easing, but it's really just the strawman. It doesn't create nearly as much funny money as fractional reserve banking. Next Saturday marks the one-year anniversary of the Fed making the reserve requirement for Banks at 0%. Yes, you read that right, zero percent. That little factoid got missed in the covid noise. Effectively there is no limit to how much a dollar can be amplified in our ec
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I think, what we call crypto was intended to be certral to SOMETHING relevant to systems (computer) and their internal transactions. The fact that the system exists and doing SOMETHING created units. I am convinced that almost NOBODY involved wanted a true decentralized digital currency based on say for example, mass cloud transactions as those currency will be weighted by the value of cloud task(s), the efficiency of the cloud, the intent of the cloud. ZERO speculation at that point unless you are a progra
Governments love electronic currency (Score:2)
No one should be surprised that governments love electronic currency. As in China now, it allows them to pry into every detail of your life and to insure that you are not hiding any money from their tax people. In fact, you won't need to pay taxes at all; the government can just take them from your accounts automatically. We all need to remember that the technology that supports cryptocurrencies was invented by a group of people who wanted to be free from the domination and whims of governments and centr
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Tax prep lobby will NEVER let automatic taxes happen.
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The same government that's $30T in debt? (Score:2)
Good idea, let's trust them with the new financial system.
I'm reminded of the Soviet era (Score:2)
My mother grew up in post-revolution Soviet Union. At one point, the government changed currency and you had to turn in all of your old stuff for new stuff which in theory had the same value (it probably didn't). To make matters worse, you could be sent to Siberia if you were found in possession of the old money even though it was useless.
Who's to say that eventually you'll have to turn in your dollars for a digital currency at an exchange rate they determine?
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Who's to say that eventually you'll have to turn in your dollars for a digital currency at an exchange rate they determine?
We already have precedent:
On April 5, 1933, President Roosevelt signed Executive Order 6102. It was touted as a measure to stop gold hoarding but it was, in reality, a massive gold confiscation scheme. The order required private citizens, partnerships, associations and corporations to turn in all but small amounts of gold to the Federal Reserve in exchange for $20.67 per ounce.
Not a law.. This was an executive DECREE.
EO 6102 followed on the heels of an order Roosevelt issued just weeks before prohib
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What's funnier though is people like you who think the economy would have grown at all if we were stuck on some kind of gold standard.
Economic illiterates are the best ignorant people to laugh at.
...and any actual arguments for that, other than "govt shills told me so, so it must be true"?
We already have a digital currency (Score:2)
Meanwhile in the rest of the world. (Score:2)
The banking system isn't stuck in the middle ages, and bank to bank transfers, debit cards, secure online payments, are all already "digital", but without needing a centrally controlled repository of all your transactions.
This is a solution to a problem that doesn't exist in most countries, and can be solved in a much less intrusive way.
Why a new currency? (Score:2)
Could someone explain the difference and advantage of having a new digital currency instead of just having quick, easy digital access to the regular currency?
In Sweden we have a system where we can transfer money to each other and to shops in a few seconds using our phones. When the system goes down (not often but it happens) we still have access to the money using debit/credit cards, ATM:s, and - with some effort - bank offices. What would a new digital currency add to this except loss of the fallback?
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Big deal (Score:2)
That's not exactly different from how banks work now.
No it won't (Score:2)
Many people who don;' bank, who don't have accounts, don't want accounts, and for a variety of reasons. Some don't want accounts due to past experience, others value their privacy, some prefer cash despite the disadvantages.
You will only change this by legislation - making it illegal. You all are relatively smart people you figure it out.