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Interesting topic but there’s not much in the article beyond the headline. The only given rationale is that the BoE might need to issue a digital currency or el

Interesting topic but there’s not much in the article beyond the headline. The only given rationale is that the BoE might need to issue a digital currency or else “Big Tech” might end up “controlling money.” Perhaps there’s a better article with more insight, but from this alone I get the feeling this is may just be politicians creating pork for consultants.

AmericanChopper 4y ago
I work in a sort of tangential field, and know a lot of people who are involved with digital currency related public policy. The governments motives for taking an interest in this are basically the exact opposite of the motives of decentralized digital currency proponents. Decentralized digital currency offers the potential for increased anonymity, and a lack of central control/regulation/oversight/ect… Centralized digital currencies offer governments highly increased potential for surveillance, regulation and policing. They create the ability for the central authority to monitor and control the use of money in a far more fine grained manner than the existing financial systems do. All of the use cases that I hear talked about are focused around these themes, with the threat of decentralized digital currencies undermining these capabilities motivating a lot of the interest.
- alchemist1e9 4y ago
  The ultimate irony will be the harder governments try to push CBDCs the more they will increase demand for Bitcoin. Which sounds like better money: 1. money that can expire. be tracked 100% and censored. be auto taxed. auto inflated. or 2. money that has limited supply. is permission-less and uncensored. and no single party can control. It’s the ultimate foolishness of governments to believe the will win that competition. That leads to the proposal they try to ban the 2nd type, but yet again, ironically, that will only increase the demand for it.
  - AmericanChopper 4y ago
    > It’s the ultimate foolishness of governments to believe the will win that competition. I don’t think it’s foolishness at all. The government today has much more power than it did when I was a child. When did anybody ever succeed in reversing this trend? This type of regulation is perfectly poised for success as well, as most people will be unaffected by it, and most people won’t even have any motive to understand the concepts involved. The big financial players don’t really care either, because their roll in the system isn’t really threatened by most of this.
    - alchemist1e9 4y ago
      Except with Bitcoin it needs all governments everywhere to coordinate in banning it. It would require extensive intrusive control of the internet. It seems incredibly unlikely that democratic governments will succeed in suppressing Bitcoin and promoting CBDCs.
      - AmericanChopper 4y ago
        Banning Bitcoin has never been necessary. If you want to do business in the UK (or any other place), then you need to comply with the rules of their financial institutions. That means doing the KYC, complying with the AML rules, and using whatever currency the central government issues. The government doesn’t need to promote anything. They are the ones who make the rules.
        alchemist1e9 4y ago
        You seem to have never heard of capital flight. Won’t be any different when fiat currencies start collapsing one day.
        AmericanChopper 4y ago
        Capital flight isn’t especially relevant. People with capital will always want access to advanced economies, and to get that access you need to use the currency issued by the economy’s central bank. There’s also no reason think this would be a capital-hostile move, large capital transactions are already highly scrutinized and regulated. This would compromise the privacy and freedoms of individuals, who I doubt are going to care.
  - cbeach 4y ago
    The problem is that the government CAN ban crypto currencies like Bitcoin. What use is a currency that cannot be used for any lawful purchase? As long as government exists, we will never have a fair "competition" to find the consumer's favourite currency. The currency that wins will be the currency the government collects tax in. If you think about it, that's the underlying purpose of tax - to ensure that a government's centrally-issued currency (be it fiat, crypto or gold coins) is the means by which the government itself can procure goods and services.

AmericanChopper 4y ago

I work in a sort of tangential field, and know a lot of people who are involved with digital currency related public policy. The governments motives for taking an interest in this are basically the exact opposite of the motives of decentralized digital currency proponents. Decentralized digital currency offers the potential for increased anonymity, and a lack of central control/regulation/oversight/ect… Centralized digital currencies offer governments highly increased potential for surveillance, regulation and policing. They create the ability for the central authority to monitor and control the use of money in a far more fine grained manner than the existing financial systems do. All of the use cases that I hear talked about are focused around these themes, with the threat of decentralized digital currencies undermining these capabilities motivating a lot of the interest.

alchemist1e9 4y ago
The ultimate irony will be the harder governments try to push CBDCs the more they will increase demand for Bitcoin. Which sounds like better money: 1. money that can expire. be tracked 100% and censored. be auto taxed. auto inflated. or 2. money that has limited supply. is permission-less and uncensored. and no single party can control. It’s the ultimate foolishness of governments to believe the will win that competition. That leads to the proposal they try to ban the 2nd type, but yet again, ironically, that will only increase the demand for it.
- AmericanChopper 4y ago
  > It’s the ultimate foolishness of governments to believe the will win that competition. I don’t think it’s foolishness at all. The government today has much more power than it did when I was a child. When did anybody ever succeed in reversing this trend? This type of regulation is perfectly poised for success as well, as most people will be unaffected by it, and most people won’t even have any motive to understand the concepts involved. The big financial players don’t really care either, because their roll in the system isn’t really threatened by most of this.
  - alchemist1e9 4y ago
    Except with Bitcoin it needs all governments everywhere to coordinate in banning it. It would require extensive intrusive control of the internet. It seems incredibly unlikely that democratic governments will succeed in suppressing Bitcoin and promoting CBDCs.
    - AmericanChopper 4y ago
      Banning Bitcoin has never been necessary. If you want to do business in the UK (or any other place), then you need to comply with the rules of their financial institutions. That means doing the KYC, complying with the AML rules, and using whatever currency the central government issues. The government doesn’t need to promote anything. They are the ones who make the rules.
      - alchemist1e9 4y ago
        You seem to have never heard of capital flight. Won’t be any different when fiat currencies start collapsing one day.
        AmericanChopper 4y ago
        Capital flight isn’t especially relevant. People with capital will always want access to advanced economies, and to get that access you need to use the currency issued by the economy’s central bank. There’s also no reason think this would be a capital-hostile move, large capital transactions are already highly scrutinized and regulated. This would compromise the privacy and freedoms of individuals, who I doubt are going to care.
- cbeach 4y ago
  The problem is that the government CAN ban crypto currencies like Bitcoin. What use is a currency that cannot be used for any lawful purchase? As long as government exists, we will never have a fair "competition" to find the consumer's favourite currency. The currency that wins will be the currency the government collects tax in. If you think about it, that's the underlying purpose of tax - to ensure that a government's centrally-issued currency (be it fiat, crypto or gold coins) is the means by which the government itself can procure goods and services.