Italian payments giant Nexi
says it is working with the European Central Bank on its proposed central bank digital currency.
“We are engaging with the European Central Bank and contributing to the design of the future digital euro because we believe that can be a positive force in the evolution of digital payments,” Nexi CEO Paolo Bertoluzzo told CNBC’s Karen Tso at the Money 20/20 fintech conference in Amsterdam on Tuesday.
The ECB outlined its plans for a digital version of the euro
in July. The euro zone’s central bank envisages the currency as complementary to its existing monetary system
, rather than
replacing physical cash or reducing the role of commercial lenders.
Specific members of note in either the Engagement Forum and Technology Forum include PayPal, Monzo, Starling, Checkout.com, ConsenSys, R3, Visa and Mastercard, among others.
Per the BoE’s release, the purpose of the Engagement Forum is to “gather strategic input on policy considerations and functional requirements pertaining to CBDC.”
Conversely, the Technology Forum will “help the Bank to understand the technological challenges of designing, implementing and operating a CBDC.”
Payments giant Visa has taken a step toward achieving its vision
for central bank digital currencies (CBDCs). It has developed a concept that shows how various CBDCs can be interoperable with each other to make payments.
Digital currencies, including CBDCs and stablecoins, will play an essential role in people’s financial lives in the future, according to Visa. And for digital currencies to be successful, Visa thinks they must have a great consumer experience and widespread merchant acceptance. “It means the ability to make and receive payments, regardless of currency, channel, or form factor. And that’s where Visa’s UPC concept comes in,” said the company.
As part of developing the UPC concept, Visa has also deployed its first-ever sample smart contract on Ethereum’s Ropsten testnet.
The smart contract shows a payment channel that accepts both ether (ETH) and the USDC stablecoin.
The Federal Reserve will “soon” release research examining the costs and benefits of a central bank digital currency, or CBDC, Fed Chair Jerome Powell said on Wednesday.
“We’re working proactively to evaluate whether to issue a CBDC and, if so, in what form,” Powell said in a news conference following the conclusion of the U.S. central bank’s latest two-day policy meeting.
The ultimate test that will apply when assessing a CBDC, he told reporters, is if there are “clear and tangible benefits that outweigh any costs and risks.”
WHAT DOES ALL THIS MEAN FOR BITCOIN AND THE INTERNET ECONOMY?
The Central Banks are using the full force of their traditional networks (their only source of developer talent) in an attempt to upgrade their failing systems.
The central banks can not compete against decentralized finance (DeFi) and they will do everything they can to try to stay relevant.
BFV subscribers know that it is not the cheaper settlement of digital currency that makes DeFi so attractive but rather the free crypto credit market rates and yield opportunities.
Crypto credit rates are based on free market principles like the supply of money and the demand on loans. Meanwhile, traditional rates are decided by unelected officials who demonstrate no economic understanding.
CBDCs will be offered in the traditional credit system which can only operate within the manipulated and suppressed credit markets.
Notice many of the bolded statements above read, “commercial lenders at risk…slo-motion bank run.”
We are now watching a slow motion institutional bank run in real time, and the bankers know it, so they will do what they can to maintain power, and that is most evident in the following CBDC news article…
On July 28, 2021, a new bill was introduced in the US House of Representatives. This bill, sponsored by Congressman Don Beyer) aims to regulate crypto-currencies. But it does more…
The bill is called the “Digital Asset Market Structure and Investor Protection Act”2) (“Digital Asset Bill”). And for the majority, it sets out future rules for crypto. However, hidden in this bill, changes to the foundation of the Dollar are proposed.
And because nobody outside crypto (and frankly, few inside crypto) actually read the bill, these amendments have so far largely gone unnoticed.
According to the Digital Asset Bill, section 11 of the Federal Reserve Act is to be amended to provide the Federal Reserve Board with new powers:
“Federal reserve notes, to be issued at the discretion of the Board of Governors of the Federal Reserve System for the purpose of making advances to Federal reserve banks through the Federal reserve agents as hereinafter set forth and for no other purpose, are authorized. Notwithstanding any other provision of law, the Board of Governors of the Federal Reserve System is authorized to issue digital versions of Federal reserve notes in addition to current physical Federal reserve notes. Further, the Board of Governors of the Federal Reserve System, after consultation with the Secretary of the Treasury, is authorized to use distributed ledger technology for the creation, distribution and recordation of all transactions involving digital Federal reserve notes. The said notes shall be obligations of the United States and shall be considered legal tender and shall be receivable by all national and member banks and Federal reserve banks and for all taxes, customs, and other public dues. They shall be redeemed in lawful money on demand at the Treasury Department of the United States, in the city of Washington, District of Columbia, or at any Federal Reserve bank.”
The importance of this bill can not be overstated.
The role of the Federal Reserve could be expanded to allow for the legal tracking, tracing, and hyperinflation of the US dollar by a non-elected, foreign controlled private institution.
This is unprecedented in US history, wars have been fought for less.
How do the central banks know that their systems are failing?
They are actively experiencing a “slo-motion bank run” as smart money flees the manipulated oppression of 0.01% APY paid on dollars and flocks to DeFi where they can earn 8%+ APY paid on stablecoins with less counter-party risks and 24/7 access.
The central bankers are not only using their pull with tradfi developer talent and political pawns, but as you will see in these next articles they are also creating false narratives and pulling their political puppet strings as well.
Lets start with the false narrative…
The Federal Reserve on Wednesday telegraphed it could hike rates six to seven times by the end of 2024, illustrating the central bank’s optimism that the COVID-19 recovery will progress well enough for the Fed to tighten its easy money policies in a few years.
The policy-setting Federal Open Market Committee still held interest rates at near-zero in its updated statement, but said it had advanced talks on paring back its asset purchase program.
Since the depths of the pandemic, the Fed has been absorbing about $120 billion a month in U.S. Treasuries and agency mortgage-backed securities.
But Fed officials have said in recent weeks that by the end of the year, the economy will likely make the “substantial further progress” needed for the central bank to begin slowing the pace of those purchases.
And now to the pulling of the puppet strings…
The move would aim to address concerns that the digital currency could fuel financial panics [aka fuel panic for central bankers via bank runs].
The Biden administration is considering ways to impose bank-like regulation on the cryptocurrency companies that issue stablecoins, according to people familiar with the matter, including prodding the firms to register as banks.
The administration is also expected to urge Congress to consider legislation to create a special-purpose charter for such firms that would be tailored to their business models, the people say.
WHAT DOES THIS MEAN FOR BITCOIN AND THE INTERNET ECONOMY?
First off, the FED is lying about raising rates.
The FED can not raise rates because if they did then the US government would not be able to afford their interest payments alone, much less payments on their debt, which would lead to a wave of sovereign defaults.
The FED has to lie about raising rates in order to keep institutional clients from accelerating the bank run by flocking to DeFi.
If the FED was not hinting at higher rates and better yield then the slo-motion bank run we are currently watching would quickly turn into an escape-velocity run that would make the Great Depression bank runs look like childs play.
Second, the bankers are utilizing the Biden administration to target their competitors.
BFV subscribers will remember from Issue #3
that stablecoins are actually less risky dollar positions as stablecoin custodians maintain $1 dollar of cash and cash equivalents for every $1 of minted stablecoin liability, however by law
Banks are allowed to maintain $0 dollars of cash and cash equivalents for every $1 of liability created through bank loans and credit.
This is why Bank runs can happen in the traditional system but are impossible with responsible stablecoin custodians.
We can all sense the desperation behind the actions of the FED and their private elite owners…
Bitcoin and its kin have in the last year soared in price and popularity, with emerging and developing market economies such as Vietnam, India and Pakistan seeing rapid growth in some measures of adoption, according to
U.S. blockchain researcher Chainalysis.
The advent of digital currencies in emerging markets could spark “cryptoization” of local economies, potentially undermining exchange and capital controls and upsetting financial stability, the International Monetary Fund said on Friday.
If you want to better understand their desperation and the slow motion bank run all one has to do is take a look at the below chart of real interest rates when accounting for real inflation.