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Money in my bank account cannot have an expiry date, which is something that would be possible with this new digital currency. The bank cannot limit where I can

Money in my bank account cannot have an expiry date, which is something that would be possible with this new digital currency. The bank cannot limit where I can spend it, at least not as easily.

mitthrowaway2 4y ago
To be clear, that's a tremendous concern, but it doesn't have any connection to crypto. The reason that the money in your bank account can't expire is because if a private bank tried to do that, it would trigger a bank run - everyone would withdraw their funds as paper, or transfer them to a different bank. The reason the CBDC is different is because there cannot be a run on a central bank as the issuer of currency, and it alone can assert that its unit of account is a legal replacement for paper banknotes. So it can establish policies like an 'expiry date' for deposited funds, which a private bank could not (at least, not until the central bank does first). Banks certainly can limit where you spend your money though - again, with the exception of cash withdrawals.
- Fervicus 4y ago
  Your original point of contention was that CBDC isn't even a cryptocurrency. It is presumably using the tech that was built by the crypto community, like smart contracts.
  - mitthrowaway2 4y ago
    Why would you presume that? I think it's much more likely to use the same tech that banks and credit cards use for their own bookkeeping. "Money with an expiry date" is in line with line-of-credit products that banks already offer, and taken to its continuous limit, is simply a negative interest rate.
    - Fervicus 4y ago
      Because they are already talking about it. https://www.forbes.com/sites/sap/2021/03/25/as-programmable-money-emerges--central-banks-ramp-up-for--tokenized-economy/?sh=5431fb91c402 https://www.forbes.com/sites/sap/2021/03/25/as-programmable-... https://www.federalreserve.gov/econres/notes/feds-notes/what-is-programmable-money-20210623.html https://www.federalreserve.gov/econres/notes/feds-notes/what...
  - int_19h 4y ago
    There's no need for them to use smart contracts. Why would you need a self-enforcing contract if you're the guy with monopoly on violence who's enforcing everything in the first place? Smart contracts are an attempt to solve the issue of decentralized trust; this is literally the opposite, an attempt at hyper-centralization.
JeremyNT 4y ago
This seems odd to me. The "money" you have in your bank is already purely digital, a fiction. It's not as if you go to and from the bank carrying physical notes and leave them in a box you control. If your government wants to take away "your" money, they clearly have the technical ability to do it by compelling the bank to freeze your assets. Likewise, that bank you are currently trusting so much could readily shave a couple of zeros off your balance. There is absolutely nothing technological stopping any of this. For the shared fiction of "ownership" of intangible assets to work, we are all at the mercy of one thing: the rule of law.

Money in my bank account cannot have an expiry date, which is something that would be possible with this new digital currency. The bank cannot limit where I can spend it, at least not as easily.

mitthrowaway2 4y ago

To be clear, that's a tremendous concern, but it doesn't have any connection to crypto. The reason that the money in your bank account can't expire is because if a private bank tried to do that, it would trigger a bank run - everyone would withdraw their funds as paper, or transfer them to a different bank. The reason the CBDC is different is because there cannot be a run on a central bank as the issuer of currency, and it alone can assert that its unit of account is a legal replacement for paper banknotes. So it can establish policies like an 'expiry date' for deposited funds, which a private bank could not (at least, not until the central bank does first). Banks certainly can limit where you spend your money though - again, with the exception of cash withdrawals.

Fervicus 4y ago
Your original point of contention was that CBDC isn't even a cryptocurrency. It is presumably using the tech that was built by the crypto community, like smart contracts.
- mitthrowaway2 4y ago
  Why would you presume that? I think it's much more likely to use the same tech that banks and credit cards use for their own bookkeeping. "Money with an expiry date" is in line with line-of-credit products that banks already offer, and taken to its continuous limit, is simply a negative interest rate.
  - Fervicus 4y ago
    Because they are already talking about it. https://www.forbes.com/sites/sap/2021/03/25/as-programmable-money-emerges--central-banks-ramp-up-for--tokenized-economy/?sh=5431fb91c402 https://www.forbes.com/sites/sap/2021/03/25/as-programmable-... https://www.federalreserve.gov/econres/notes/feds-notes/what-is-programmable-money-20210623.html https://www.federalreserve.gov/econres/notes/feds-notes/what...
- int_19h 4y ago
  There's no need for them to use smart contracts. Why would you need a self-enforcing contract if you're the guy with monopoly on violence who's enforcing everything in the first place? Smart contracts are an attempt to solve the issue of decentralized trust; this is literally the opposite, an attempt at hyper-centralization.

JeremyNT 4y ago

This seems odd to me. The "money" you have in your bank is already purely digital, a fiction. It's not as if you go to and from the bank carrying physical notes and leave them in a box you control. If your government wants to take away "your" money, they clearly have the technical ability to do it by compelling the bank to freeze your assets. Likewise, that bank you are currently trusting so much could readily shave a couple of zeros off your balance. There is absolutely nothing technological stopping any of this. For the shared fiction of "ownership" of intangible assets to work, we are all at the mercy of one thing: the rule of law.