The Federal Reserve just released a long anticipated study on the potential for the U.S. government to create and issue digital currency. They did so under the auspice of the revolution of the cryptocurrency market and the possible role for the U.S. government to play in that market.
However, what the report demonstrates and what most casual readers may not understand is that a digital currency issued by the United States would be totally controllable by the United States government. It would never filter through a private bank. It is not tangible. This means that the government would quite easily be able to track all purchases and spending – which is the least of our concerns considering they could also easily revoke the digital credits without warning, remuneration or remorse for any reason that they come up with as the future unfolds.
But how is digital currency different from crypto or even all of the digital non-cash transactions we make today? Right now we use digital platforms to trade the representation of what is technically physical wealth. And that wealth lives within a private bank who we have a mutual, private agreement to house and often invest the money to keep it safe and for us to use when we see fit. The government backs those banks already to ensure solvency. Cryptocurrency does not need the bank system and exists in a decentralized universe where it is interactive between only the currency and the consumer.
What the Fed is exploring (albeit not officially proposing) is the idea that the currency itself would be directly issued from the government to the consumer with no physical meaning and no private storage or collaboration. China is also exploring this option.
Imagine that we had digital currency. Imagine that your employer has to pay you in U.S. credits from the Fed and you get issued those based on basically the same system that you’re issued current dollars. But instead of the direct deposit going into your bank – it would be banked with the Fed. Let’s say you refuse to get vaccinated and the government decides to lien paychecks for anyone who won’t vaccinate. There would be no ability to rally a resistance to that action. Let’s say you purchase a firearm or let’s say even more so you want to purchase something illegally. Could they just simply halt the transaction?
The Fed has yet to make an official proposal but a digital U.S. currency could be a major take over of our finances by the federal government.