Those of you familiar with private crypto currencies understand that there has been mountains of propaganda, issuing from central organisations, warning people against them. Yet, at the same time, I believe the important financial institutions of the day are playing catch up as they have plans to create a Central Bank Digital Currency (CDBC) exploiting developments in the private sphere.
CCO
In June 2022 the Bank for International Settlement (BIS) produced it’s Annual Economic Report. Part three of this report concerns The Future of Money.
In the introduction it states clearly that;
At the heart of the monetary system stands the central bank. As the central bank issues money and maintains its core functions, trust in the monetary system is ultimately grounded in trust in the central bank.
It starts with key takeaways:
A burst of creative innovation is under way in money and payments, opening up vistas of a future digital monetary system that adapts continuously to serve the public interest.
In other words central banks, utilising technology that has been developed in the private crypto sphere, to extend their control to execute policy and modify rates instantaneously.
Structural flaws make the crypto universe unsuitable as the basis for a monetary system: it lacks a stable nominal anchor, while limits to its scalability result in fragmentation. Contrary to the decentralisation narrative, crypto often relies on unregulated intermediaries that pose financial risks.
What they are saying here is private crypto currencies are bad.
A system grounded in central bank money offers a sounder basis for innovation, ensuring that services are stable and interoperable, domestically and across borders. Such a system can sustain a virtuous circle of trust and adaptability through network effects.
Whereas Central Bank Digital Currencies (CDBC) are good.
New capabilities such as programmability, composability and tokenisation are not the preserve of crypto, but can instead be built on top of central bank digital currencies (CBDCs), fast payment systems and associated data architectures.
CBDCs can do everything crypto can, but better.
In this video Lynette Zang, chief market analysis at ITM Trading, breaks down this paper and explains that what is on the agenda here is none other than the formation of a one world monetary system. This lies very much at the core of the plans by the WEF, Davos etc for their Great Reset.
What they plan to do is very much in plain sight these days.
A CDBC you see is not;
subject to the practical limitations of paper money
Germany during the hyperinflation
Naturally they say;
the system must protect privacy as a fundamental right, and provide user control over financial data. The integrity of the system must be protected, by guarding against illicit activity such as money laundering, financing of terrorism and fraud.
Under these dangers the justification will be made that these risks must be mitigated by an identity-verified system in which intermediaries collect and verify customer information. Private keys they refer to as pseudo-anonymity.
Under the guise of having no "commercial interest" they present a model" similar to open banking" which is "identity based". The glossary defines;
Open banking: the sharing and leveraging of customer-permissioned data by banks with third-party developers and firms to build applications and services.
If you don't find this risible yet, there's more;
Unlike in a parallel crypto financial system, parties can be held to account for their actions
On retail CBDCs they clearly state they;
are supported by a data architecture with digital identification
In a common mCBDC platform, transfers are recorded on a single ledger in one step,
Rooted in trust in the currency
Now you’ve got to ask yourself do you think banks have been held accountable for their actions? Do you trust the central banks and their intermediaries with the privacy of your data? Do you trust in the currency?
They are banking that the vast majority of people will do exactly that.
Programmability
Wholesale CBDCs that are transacted using permissioned distributed ledger technology (DLT) offer programmability
One huge draw of CDBCs is their programmability. Yes, we know that it can be used to settle a contract when all the conditions have been met. However, it’s obvious that it could (probably will) be used by governments to direct the behaviour of their citizens.
I mean look at the financial assault used on the Canadian Truckers earlier this year.
Much of this BIS (try BS) paper is concerned with tearing down what has been achieved in the private crypto space, and a presentation with how they are going to do the same thing but better. Basically they are saying large central banks can overcome the trilemma of scalability, security and decentralisation.
In the paper they discuss a dense network of interconnections and this will all be through the central banks and the financial system.
It will have all the appearance of decentralised “multi-CBDC platforms”, but it will be run as a group by central banks.
The central bank supports the singleness of the currency,
In sum, central banks are working together to advance domestic policy goals and to support a seamlessly integrated global monetary system.
You see it couldn’t be plainer. The BIS is working towards the development of a one world currency. They are also not the only body doing this.
This is their plan, but whether they are able to put it into motion remains to be seen. Or, if indeed this system is put in place, whether it doesn't break down fairly rapidly. The best laid plans of mice and daleks.
