Digital Dollar Is a Long Way From Reality, US Treasury Official Says (bloomberg.com) 39
The Treasury Department's top official for financial markets and stability expressed little urgency over the federal government's need to prepare for the potential launch of a digital US dollar. From a report: Regulators need to examine whether a central bank digital currency -- or CBDC -- would actually improve the speed or cost of real time interbank payments, which the Federal Reserve is aiming to introduce in 2023, said Nellie Liang, undersecretary for domestic finance at the Treasury. Asked whether a digital dollar would help defend the primacy of the dollar in international commerce or as a reserve currency, she was even clearer.
"My view is our global leadership doesn't come from our technology," she said in an interview at Bloomberg News's Washington office Monday. "It comes from our governance system, the rules that govern our financial markets, our rule of law and the safety and soundness of our institutions." If after five or more years many countries have introduced a CBDC, she added, that might become a factor in pushing the US to adopt one. But she emphasized the US government's study of a potential CBDC was mainly to be prepared for a need that didn't currently exist.
"My view is our global leadership doesn't come from our technology," she said in an interview at Bloomberg News's Washington office Monday. "It comes from our governance system, the rules that govern our financial markets, our rule of law and the safety and soundness of our institutions." If after five or more years many countries have introduced a CBDC, she added, that might become a factor in pushing the US to adopt one. But she emphasized the US government's study of a potential CBDC was mainly to be prepared for a need that didn't currently exist.
This isn't about consumer convenience... (Score:1)
...this is about control over consumers and making more money at the top level.
Re: (Score:2)
In some countries, I can send money to anyone in seconds. In America, transferring from one bank to another can take several days.
Re:This isn't about consumer convenience... (Score:4, Insightful)
we like to have records to confirm if you are allowed to money launder or not.
Re: (Score:2)
Re: This isn't about consumer convenience... (Score:1)
In some countries you can pretend to send instantly, as you can in the US. Credit cards transfer apparently instantly too. If you can settle instantly and not at the end of the month or some other arbitrary time that allows for human review, there is no protection against fraud however.
Addicted to the fees (Score:2)
Banks and credit card companies take their cut out of every transaction for those pretend-instant transfers (in addition to all the interest they make on holding all that money). That's the real reason moving to a digital currency has been so slow; financial industry lobbyists are fighting it all the way.
Re: (Score:2)
Banks and credit card companies take their cut out of every transaction for those pretend-instant transfers
In America, there are fees, and the underlying transactions are slow.
In China, there are no fees for most transactions, and they happen instantly.
Re: (Score:2)
Anyway, I would bet my shirt that nowadays, US already has digital currency!
I strongly suspect that not all money put in circulation by the federal reserve is actually printed but that some if not most of it is simply transferred digitally without ever being printed.
Unfortunately, I am too lazy to search about it. Anybody actually knowing if I'm right is welcomed to comment...
Thanks in advance!
Re: (Score:2)
Oh never mind, I was right it seems...
However, the vast majority of the American money supply is digitally debited and credited to commercial banks.
Here is the link:
https://www.investopedia.com/a... [investopedia.com]
Re: This isn't about consumer convenience... (Score:2)
Re: This isn't about consumer convenience... (Score:2)
Re: Consumer convenience is normal (Score:1)
Re: This isn't about consumer convenience... (Score:2)
Debt ceiling fight is dangerous. (Score:5, Insightful)
"My view is our global leadership doesn't come from our technology," she said in an interview at Bloomberg News's Washington office Monday. "It comes from our governance system, the rules that govern our financial markets, our rule of law and the safety and soundness of our institutions."
Spot on. This is why the debt ceiling law, decoupled with budget, is very dangerous. Allows law makers to pass all kinds of benefits, without funding it with spending cuts or revenue increases. And then come back and posture about caring about spending and grandstand and vote against debt ceiling increases. When the budget is passed, the deficit has to be borrowed, and it should automatically raise the ceiling by that amount.
Messing with the full faith and credit of USA should not be allowed. We are the only borrower who have never ever defaulted, who had never failed to pay interest. So many law makers play with this in cavalier manner.
Re: (Score:2)
Re: (Score:2)
Far better than the, I'm sorry, piss-poor idea of letting the debt ceiling float to whatever math-deficient politicians want it to be, would be if Congress debated on and passed actual budgets that were actually balanced. This is entirely possible, but they have to be willing to do their jobs.
A digital dollar could be good... (Score:2)
We need a digital dollar to complement the digital world, a dollar which can carry the modern concepts which benefit society so much.
Paying for digital content? Pay with a digital dollar whose use can be restricted the same way that digital content is. Your digital content becomes unusable because the servers have been switched off? Simply revoke the rights to use the digital dollars you spent on it.
You could call it the Saucefortheganderyoulyingtheivinghidingbehindcapitalismscumbagsdollar.
Or maybe there is
Re: (Score:3)
Re: (Score:2)
It is you who are being naive, the situation you describe could only arise if the whole of society had been rigged.
Re: (Score:2)
In reality, the digital dollars in your account will have expiration dates and the capacity to be revoked by the issuer....
I think that's highly unlikely, considering most of our banking system has been digital money for decades now. All of our money is just entries in a database, ultimately backed by nothing more than how much of the GDP has be allocated to us.
A digital Dollar would be nothing more than a change in how those entries are transported from account to account.
Re: (Score:2)
I think that all (as opposed to most) transactions in our banking system have been digital for a long time. However that doesn't discount his argument. If you have $20 in your bank account it can be revoked much easier than a $20 bill in my pocket. Unless, of course, if cash is eliminated. That, I would argue, is the end-game here.
Re: (Score:2)
And I'm not sure you've appreciated all the aspects of what you propose. What happens when you 'revoke' these hypothetical dollars? Do you think they are still held by the same entity, or have they been paid to someone else, who paid their mortgage, whose bank used it to pay a cashier, who bought a meal...
Digital Rupee might come in sooner (Score:3)
India is more concerned with the rampant tax evasion, black market and corruption. Wants to reduce the value of paper currency. So it is trying hard to create what it calls, "digital rupee" but it is fully traceable and govt is the cleaning house and the ownership transfer agent.
Already small transactions by even road side vendors, street hawkers are going digital through bank accounts. Govt is hoping once you make spending paper money hard, black money will be devalued.
The Dollar has been digital for years (Score:3)
One dollar has been eight bits for eons. A shave and a haircut? Two bits.
Re: (Score:1)
It's not a _decentralized_ digital currency, but until one of those manages to become stable enough to count as a strong curre
Already exists (Score:4, Informative)
The dollar is already digital. I have this called a credit card that every company already accepts. My money direct deposited. I never have to see physical cash.
What makes crypto crypto is how the money is generated and verified - by a distributed network anyone can join, with honesty maintained by cryptological methods.
If the US was to create a CBDC it would not let anyone but the FED generate money, nor would it prevent using the existing methods of verification. The mere creation of an anonymous distributed verification method on top of the existing system is quite frankly, irrelevant. The only advantage would be to let people hide their transactions by using this distributed verification system rather than the existing one.
But no one seriously believes the US government would allow that. The only way they would create a distributed verification system was if they put in a back door that they could use.
So a CDBC would basically be a bank account that no one EXCEPT the US government could track. Which I can not see becoming popular except among US government employees.
Re: (Score:2)
Re: (Score:2)
Cash is already anonymous
Most transactions are already purely digital
All Crypto currency would give us is a system that when money is stolen it is untraceable, and near impossible to recover ,,, ...Unless it is tracked then it has no advantages at all ...
Re: (Score:3)
This is the part that is not available to digital cash. It should not be available to anyone who denounces "fiat currency" with bravado. Once digital cash is exactly same as a duffel bag full of currency bills, except it is easier to carry, you are on your own when it comes to defending it from thieves and scammers.
It is extremely hard to spend a million bucks in pape
Re: (Score:2)
Third party processor = distributed verification network, which I specifically talked about.
Credit cards companies are non-distributed verification systems.
Re: Already exists (Score:2)
Re: (Score:2)
USDT or USDC
Re: (Score:1)
Pure slavery (Score:1)