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That money in your bank account has value like hard currency, and it can't be transferred between two parties in the same way that hard currency can. Transfers

That money in your bank account has value like hard currency, and it can't be transferred between two parties in the same way that hard currency can. Transfers from your bank account require a number of intermediaries, and (in the US) it still takes days to be finalized. A digital currency would not only have value like cash, but would be transferrable like cash. The only middle-men would be the fed (or whoever would be running the currency), who would track transactions to prevent shenanigans (like someone trying to spend the same digital dollar twice). As an aside, the hype around cryptocurrencies is that they offer the same sort of cash-like transferrability, and by using a distributed 'trustless' model, they are able to guarantee safe transactions without the need for a trusted third party like the fed.

nine_k 5y ago
But trustless models need some kind of hard-to-forge proof. In the case of gold it's the chemical element. In the case of banknotes, it's really laborious printing (and much more). In the case of bitcoin, it's hard-to-find sha hashes. What would prevent a trustless digital coin from being forged? It's by far easier if we have trusted parties, like with SSL certificates,, or other digitally signed and cross-signed stuff. It of course puts such cash under control of the Fed. But it's sort of expected of a national currency. Also, fully traceable by design digital currency is very unlike untraceable cash. Of course, no government, no law-enforcement agency would miss a chance to make all financial transactions visible. Of course it's only to prevent money laundering from terrible crimes like sex slavery and contract murders, but the ability to know e.g. the sources and targets of any donations would be a nice side benefit.
- kqr 5y ago
  That gold or bank notes would be hard to forge is somewhat of an exaggeration[1]. History, old and recent, is filled with forged money of both metal and paper kinds. What actually prevents forgery are the harsh punishments for it. Historically, forgery of money was often associated with death penalty. Authorities know that centralised money (both metal and paper) is a brittle illusion that must be maintained by force. All of this to say that ease of forgery might not be a good argument against a currency. Difficulty of forgery might, on the other hand, be a very strong argument for one. [1]: A bit of an anecdotal story, but still illustrative: a few years ago I paid for a thing with coins. The seller asked "What is this?" And I thought to myself "Money?" It turned out there was a good reason for the question: one of the coins was a Canadian cent. I live half a world away from Canada; it just looked a little bit like one of the domestic coins, so I had accepted it from somewhere, who probably had also blindly accepted it from somewhere else. Despite it not being legal tender, it was accepted at a value far above its nominal value in the country where it would be legal tender. This was a coin that didn't even try to look like a domestic coin. It just happened to share some superficial similarities. All of this to say that with just a little bit of effort, you can probably create something that will circulate just fine for a few hands at least.
- danuker 5y ago
  > Of course it's only to prevent money laundering from terrible crimes Snowden proved that wrong.
  - nine_k 5y ago
    /s

nine_k 5y ago

But trustless models need some kind of hard-to-forge proof. In the case of gold it's the chemical element. In the case of banknotes, it's really laborious printing (and much more). In the case of bitcoin, it's hard-to-find sha hashes. What would prevent a trustless digital coin from being forged? It's by far easier if we have trusted parties, like with SSL certificates,, or other digitally signed and cross-signed stuff. It of course puts such cash under control of the Fed. But it's sort of expected of a national currency. Also, fully traceable by design digital currency is very unlike untraceable cash. Of course, no government, no law-enforcement agency would miss a chance to make all financial transactions visible. Of course it's only to prevent money laundering from terrible crimes like sex slavery and contract murders, but the ability to know e.g. the sources and targets of any donations would be a nice side benefit.

kqr 5y ago
That gold or bank notes would be hard to forge is somewhat of an exaggeration[1]. History, old and recent, is filled with forged money of both metal and paper kinds. What actually prevents forgery are the harsh punishments for it. Historically, forgery of money was often associated with death penalty. Authorities know that centralised money (both metal and paper) is a brittle illusion that must be maintained by force. All of this to say that ease of forgery might not be a good argument against a currency. Difficulty of forgery might, on the other hand, be a very strong argument for one. [1]: A bit of an anecdotal story, but still illustrative: a few years ago I paid for a thing with coins. The seller asked "What is this?" And I thought to myself "Money?" It turned out there was a good reason for the question: one of the coins was a Canadian cent. I live half a world away from Canada; it just looked a little bit like one of the domestic coins, so I had accepted it from somewhere, who probably had also blindly accepted it from somewhere else. Despite it not being legal tender, it was accepted at a value far above its nominal value in the country where it would be legal tender. This was a coin that didn't even try to look like a domestic coin. It just happened to share some superficial similarities. All of this to say that with just a little bit of effort, you can probably create something that will circulate just fine for a few hands at least.
danuker 5y ago
> Of course it's only to prevent money laundering from terrible crimes Snowden proved that wrong.
- nine_k 5y ago
  /s