Perhaps I’m missing something, but aren’t currencies mostly digital anyway?
I don’t actually know for sure, but surely the percentage of fiat money that exists as physical cash is pretty small? Similar for the percentage of transactions that happens physically.
Even without the physical infrastructure it might be cheaper to use credit cards. How much cash is lost in loose change after small transactions every year? I'd bet more than 2%
Digital money is still a good idea. I don't want to throw it out because current implementations are bad. No doubt, someone will invent a way to make it work. edit: in a sustainable way.
Will this hasten the, presumably, eventual move to a 100% digital economy? I’d like to see statistics on how often people use analog money. Is there correlation by certain socio economic classes? I imagine drug dealers are 100% analog while CEOs are 100% digital. Where does everyone in between land?
I think governments should create a digital cash equivalent. One that cannot be tracked any more than regular cash can (at least legally). With all the benefits and downsides, because that's the only way it would be trusted enough to work.
I think this would be a major boon to any economy that implements it well. People have no problem paying for small services in real life, because paying 30 cents is easy. Online though? It's not. It's hard for the people getting money and the people paying money.
I hate to break it to you but most dollars are already digital. Also, the problem with the dollar is noy the dollar itself but how it is managed. Most people don't get this but money is literally made up, printed out of thin air. Irresponsible central banks and policies made to serve the 1% mean that we are all f'ed in the long term.
Nobody talks about the unbanked that now have a way to transacy, about economies where the whole currency collapsed and bitcoin provides a lifeline, about businesses in the 3rd world that now are on the map, about how visa and mastercard call literally wipe your business out of existence, about businesses - like sex work - that live on the fringes of the financial world. It's all abstract here on our high horses
Various weights of gold or silver are the better comparison versus wads of cash, but your point is taken since I guess the completely digital acquisition is the difference.
Isn't that highly affected by how much money rich people (ie users of digital money) have?
One whould think paper money still is used by a good 50% of the worlds poorest, but they can't hold a candle to the amount hedge funds, banks and simply normal people from western countries move around compared to them.
Sure, most transactions are digital already. This is about the removal of physical cash as an alternative, and the downsides that presents. Especially interesting is the sudden feasibility of negative interest rates enforced across the board, and the inability to just "keep cash" as an alternative.
What I'm hoping comes out of this is some backstop for the ~4 million Brits with no bank account in our increasingly cashless society.
What I'm worrying will come out of this is pound-on-blockchain with no real effort to serve the currently-unbanked.
Also worth pointing out that the Pound (like every major fiat currency) is already digital: my bank account is stored in a computer, my payments are all electronic. Sure we still have paper notes but banks aren't backing their deposits with a big stack of those in a vault anywhere.
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