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The title is misleading. The IMF has an interest in being able to ensure digital payments are actually delivered to the parties they're supposed to since a big
by treyd 3y ago
The title is misleading. The IMF has an interest in being able to ensure digital payments are actually delivered to the parties they're supposed to since a big problem with foreign aid is cash payments being taken by force by local warlords or corrupt politicans. Nobody is seriously considering banning cash since a huge portion of the real economy is so strongly dependent on it and there's no real alternative for it.
You can and should criticize the IMF for their neoliberalist economic policies that open the gates for foreign extractive businesses, but that's a policy discussion and not a technological one. If the goal was surveillance and authoritarianism then you can do that just as well with existing payment infrastructure that doesn't use cryptography as extensively as a proposed CBDC would.
- mitthrowaway2 3y ago> Nobody is seriously considering banning cash It's mentioned frequently in research papers posted by central banks, as a way to effectively allow interest rates to drop below zero. Otherwise, this would incentivize people to stuff cash under their mattresses.
- jlund-molfese 3y agoYeah, but there are no serious proposals to ban cash that have any chance of actually happening within our lifetimes. People write research papers about all sorts of things. Omnipresent AI video surveillance of every square inch on Earth would probably have some benefits, but it’s politically unpalatable anywhere outside of a few countries.
- mitthrowaway2 3y agoThe central banks are the ones tasked with implementing the CBDC, of course. I think it's fair to say they've "seriously considered it" given that they have analyzed it in depth as part of their own monetary policy research. It is not likely to happen as part of an initial introduction of CBDCs. Whether it ever gets implemented is up to policymakers.
- treyd 3y agoIn the United States, the Fed cannot deploy a production CBDC on its own. Their responsibilities and privileges are bound by a mandate of congress, so it would require an act of congress to allow them make it happen and on what terms.
- mitthrowaway2 3y agoThat's precisely what I meant by "whether it ever gets implemented is up to policymakers." The central banks, though, are the ones who actually implement the mechanics of the CBDC, even though policymakers are the ones who authorize it. And it's likely that unless policymakers are especially wonkish about those implementation details, they will defer to the central bank's research and recommendations, in terms of how it should be implemented, once the policymakers have decided that they want the central bank to introduce a CBDC.
- raincom 3y agoI completely agree with you, as I have enough experience in the third world commission structure for government payments. Intermediate distributors always want commission; often times, local politicians even at the village level create fake beneficiaries. To cut down the graft, some kind of digital payments is necessary: mandatory bank accounts for beneficiaries, along with transfer of payments to beneficiary accounts. Even before bitcoin and after bitcoin, private banks create/destroy digital currency: they create digital money when new loans are created, and destroy digital money when loans are paid. When people receive paychecks through ACH direct deposits, it is all about moving bits around various accounts, no creation or destruction of physical currency involved. With CBDC, tokens need to be verified with some kind of entity, wallets are needed to store these tokens. What difference does it make now, when one doesn't need to deal with the hassle of opening accounts with private banks?
- janandonly 3y agoWould you have read the article if HN had shown the original title: The Digital Finance Voyage: A Case for Public Sector Involvement Keynote address, Singapore Fintech Festival?
- sgift 3y agoNo. Which is one of the reasons that the guidelines ask to not editorialize headlines. Original articles with clickbait titles are bad enough.