💰 Crypto and central banks digital currency
Chinese government minting cash digitally + the UK Central Bank Digital Currency
A thousand years ago China invented paper currency. Now, the Chinese government is minting cash digitally.
The People’s Bank of China has been developing the digital yuan, a so-called central bank digital currency that aims to move money electronically, turning legal tender itself into computer code.
The Bank of England is also launching a task force to explore the creation and implementation of a UK Central Bank Digital Currency, a digital version of sterling, not a Bitcoin-style speculative asset with wild fluctuations in value. But there will be limited appeal for the fans of crypto, who invest precisely because of their scepticism about central banks.
Digitized money looks like a potential macroeconomic dream tool for the issuing government, usable to track people’s spending in real time, speed relief to disaster victims or flag criminal activity.