Sweden Starts Testing World's First Central Bank Digital Currency (reuters.com) 46
Sweden's Riksbank said on Wednesday it had begun testing an e-krona, taking the country a step closer to the creation of the world's first central bank digital currency (CBDC). From a report: If the e-krona eventually comes into circulation it will be used to simulate everyday banking activities, such as payments, deposits and withdrawals from a digital wallet such as a mobile phone app, the Riksbank said. "The aim of the project is to show how an e-krona could be used by the general public," the Riksbank said in a statement. In January, the central banks of Britain, the euro zone, Japan, Sweden and Switzerland joined forces to assess the case for issuing CBDCs. CBDCs are traditional money, but in digital form, issued and governed by a country's central bank. By contrast, cryptocurrencies such as bitcoin are produced by solving complex maths puzzles, and governed by disparate online communities instead of a centralized body. The sharp decline in the use of cash and competition from alternative currencies, such as Facebook's Libra, has also prompted central banks around the world to consider issuing their own electronic currencies.
Avoid the Bitcoin mistake. (Score:3)
The value of the currency should be based on the economy where the currency is traded in. Not inflated because the currency itself has automatic scarcity built in.
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Yeah, more like Riskbank, amiright...
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Ummm...
"Inflation" is pretty much the opposite of "scarcity built in". Inflation is what happens when the supply of money grows faster than the supply of things to spend money on....
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He said "inflated", not "inflation."
"Inflation" is what happens when the value of goods becomes inflated, relative to the value of the currency. Or, equivalently, the value of the currency becomes deflated relative to the value of goods.
The value of Bitcoin is inflated (artificially increased) because it is scarce.
Aka "valuation" or stock trading. (Score:2)
In case you are wondering why you're so poor, compared to the wealthy few.
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I do feel sorry for you thinking that having money = better person and deserving of it.
If that is your only measure of a person, your life must be quite hollow.
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They don't print infinite money.
They print enough to keep inflation and currency values steady.
Economies work when people spend money, the general rule of thumb is every dollar you spend is 10 dollars added to the economy.
You buy something for
$1 the person who got the $1 saved 10% and spend 90 cents of that dollar, they guy save 10% and spent 81 cents.....
As people hold onto the money for savings, this brings up the value of the currency, as it is not moving, and is short in supply. If this happens too fas
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Deflation tends to be bad for the economy, so it's reasonable for governments to avoid it.
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Re: Avoid the Bitcoin mistake. (Score:2)
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When we had gold and silver money, inflation (which is reflected, eventually, in prices) was almost perfectly flat for more than 250 years (as far back as the analysis went... probably longer).
The exceptions (the little blips marked with boxes) were government borrowing for wars. But it always went right back down afterward. Until 1913.
When we transitioned to f
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I think the one thing most people don't understand about inflation is this: governments need inflation, economies don't. Governments love it because they can borrow tons of $$ and pay it back with cheaper money.
Governments already have taxes if they want money. It's true that you can use inflation as a hidden form of taxes instead of balancing your budget, which is great if people suck at paying taxes like in Greece. But most nations have a weak inflation (~2% typically) to encourage circulation and investment. That's for the economy, you don't want it dropping below zero because then the hoarding of money becomes a blocker to the trading of actual goods and services.
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So to counter that money needs to be carefully added to the economy to allow the currency to be uses what is suppose to be used for.
This doesn't specify why the added money needs to go to the government and/or the banks, rather than directly to the people, if "purchasing power" and/or liquidity is the actual objective.
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The value of the currency should be based on the economy where the currency is traded in. Not inflated because the currency itself has automatic scarcity built in.
Well pretty much all current implementations have one central entity who can literally print money, if you want a peer-to-peer currency that's clearly not an option. So it's either accepting that your money is centrally controlled, deal with Bitcoin's deflationary economy or come up with a third alternative. If you got suggestions I think a lot of people are willing to listen...
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Comment removed (Score:3)
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If Switzerland or Luxembourg did their own version of e-gold, they'd make a fortune in seniorage.
-jcr
Yeah, but who wants to wait until their over 65 years old to make their fortune?
Gold is not that real of a value either. (Score:2)
I thought gold was a good thing too, until I saw how much its course swings too.
Frankly, I think work is the best thing of stable value.
1 hour of a specific work with a specific process and specific tools will always stay 1 hour of that.
If you define that properly enough, and have fixed relationships of how much hours of work $x equals 1 hour of work $y, you get a stable currency.
Also, it can't be gambled with, because no "valuation" or stock trading will ever magically make 1 hour of that precise work beco
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Gold has been stable for thousand years. In Roman times an ounce of gold would pay for a suit.
This holds true today.
https://www.businesswire.com/n... [businesswire.com]
Obviously gold stocks are subject to speculation but the tangible asset remains stable.
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More surveillance (Score:3)
Still think it's a good idea? Still think cash should go away? Enjoy having everyone literally up your ass 24/7 your entire life.
You may as well be walking around in public stark naked.
Hell, you go to an airport they SEE you naked (millimeter wave scanner)!
Come on, people, fight this shit!
Re: More surveillance (Score:2)
People are fighting for privacy in a digital currency world. Check out Rohan Greyâ(TM)s research in the CBDC space.
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100% accurate. As soon as you put something on a network it is NOT going to be private. Privacy is 100% antithetical to networks.
I agree, but... (Score:2)
I'd have to prove you are right in the first place, before we could even have anything to prove wrong.
Oh, and also at best, you can *show* it is right/wrong. This is not mathematics, but reality. You don't have all the information and can't blindly rely in unprovable axioms.
Apart from all that ... Yes, I also think they are doing this for rhe usual totalitarian purposes. But I base that view on past experience. Especially recent experience.
Krona is already electronic (Score:2)
On the other hand, I have transferred money by card, app, and online banking. The Swedish crown has been electronic for everyone except ancient people, small children, criminals and immigrants hiding income from the tax authorities for many years.
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By the same token, I haven't used paper money or coin in the USA for the last decade. I can't even remember when the last time I had paper money in my wallet (no, not e-wallet)....
Though my wife does so now and then, to the tune of about $100 to $200 per year
Germany here. (Score:2)
You poor souls.
Have fun being under total surveillance.
Around here, we have saying:
Nur Bares is wahres.
(Only cash is real [money].)
We don't even accept anything else, where I work, and we never will.
And don't you fuckin' dare dragging us with you, into your privacy-free hellhole.
Theft (Score:1)
Let's be honest... (Score:2)
... with it mostly merely being a number in a database, "normal" currency was already more digital than anything.
Its relation to real valuabes was loong gone anyway.
And it's not like you can't issue credit note that say "The bearer of this coupon is issued $n e-krona by e-krona-kupong.se in exchange for the coupon".
All I get from this, is "more fast and loose, less safe and reliable". Not that banks were much safe and reliable in the first place.
governent needed (Score:2)
You want to store your money in something that's got the stability of a German Mark in 1923 or a Venezuelan Bolivar in 2019? Be my guest. I'll store my wealth in somethi
Technical details (Score:2)
A short technical description is here (english):
https://www.riksbank.se/en-gb/... [riksbank.se]
It is based on corda (which is open source, yay! The pilot is built by accenture, nay...):
https://www.corda.net/blog/wha... [corda.net]
It seems like a sane solution with a trusted parties instead of stupid mining. Offline transactions are mentioned as a possibility to evaluate.
Is this new? (Score:2)
How is this any different from central bank ledgers that create money out of thin air, then send them over SWIFT networks or whatever to transfer value to another bank or individual account?