This is a topic we have covered here extensively. For some time now, we have said that we believed it would be possible someday to have a global digital currency issued by perhaps the IMF that everyone could own and use (not just IMF members and central banks). While this article in the Financial Times makes it clear we are likely still many years from such a thing, it is now being reported in the mainstream media as something likely to happen eventually. Below are a few excerpts from the article.
-----------------------------------------------------------------------------------------------------------"Countries around the world — the UK, Russia, Canada, Australia, China and many more — are examining how they might mint their own digital currencies and put money on the blockchain. Efforts have intensified this year, although research is still at an early stage and many puzzles have yet to be worked out. But most agree on one thing: that the world is moving towards use of digital currencies.
Within the Bank of England, a team is already considering what a central bank-issued digital currency could mean. “The technology is moving quickly,” says Victoria Cleland, chief cashier, in her glassed-walled office inside the fortress-like Bank. “A lot of people think central banks are very risk averse, but we are thinking, ‘Are there opportunities to grasp innovation ourselves?’”
. . . . .
"There is an unresolved tension between blockchain libertarians who support open-source, decentralised networks, and those who seek closed, controllable databases."
. . . . .
"At the Bank of England, radical options are being discussed. One scenario even involves the blockchain being used to bypass high-street banks, with individuals holding accounts directly with the central bank, cutting out the commercial banks’ role as middleman in the circulation of money. One person familiar with the process says that high street banks have been privately pushing against this model."
. . . . .
“It’s inevitable there will be a government digital currency, eventually,” says Kenneth Rogoff, a professor at Harvard who studies the concept of a “less-cash” society. He believes that cash will never disappear, and that there will always be a role for small notes.
“Eventually, there will be government digital currencies that ordinary people have access to at very low cost.”
But he warns: “A government digital currency could be many decades away, and there are all sorts of security and regulatory issues that have to be navigated first. That said, many central banks are already thinking about it.”
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My added comments: We have covered this concept about as extensively as any media source I know of. Below are links to previous articles related to this idea.
The KlickEx virtual currency concept as envisioned by CEO Robert Bell (Mr. Bell is a very creative thinker who first introduced me to this concept)
Interview with Dr. Warren Coats on his Real SDR Proposal (see my closing comments on the idea of a global reserve currency based on modern technology)
It should be said that these are all early concept studies. If one or a few central banks were to adopt a central bank digital currency with the ability for individuals to hold accounts directly with the central bank, that is still not a global version of such a currency. And it does not address the issue of what would anchor such a currency.
However, once the concept is adopted and proven out by a real central bank, it could then eventually be applied to a global version such as a global digital SDR for example issued by the IMF. By no means is there any indication that the IMF is looking into this right now. But what we are trying to present here is the concept itself and evidence that it could eventually become a reality over time.
note: Dr. Warren Coats previewed this article and offered this comment to help clarify what the Bank of England is looking at:
What Dr. Coats is pointing out is that even though this article talks about a "central bank issued digital currency" as if this is something new, in the case of the Bank of England for example, it is just the existing British Pound managed in a new way.
The key point for me in this article is the idea of regular citizens having an account directly with the central bank which I do view as a significant change from the present and a possible baby step towards an actual global digital reserve currency like I am asking readers to imagine in the future.
People my age (60) recall when Star Trek came out and they were talking to each other on these strange hand held devices with no cord attached. The devices seemed like pure fiction at that time and something you could only imagine. The same way a global reserve currency issued by the IMF that everyone can hold in a private account at a central bank and use for transactions with a mobile phone might seem like pure fiction today.
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