Step 2. What are Central Bank Digital Currencies?

The Bank of England explanation:


The Bank provides physical money in the form of banknotes, which can be used by households and businesses to make payments. We also provide electronic money, but this can only be used by banks and selected financial institutions. A Central Bank Digital Currency would make electronic money, issued by the Bank of England, available to all households and businesses. This would allow everyone to make electronic payments in central bank money.

If a CBDC were to be introduced, it would be denominated in pounds sterling, just like banknotes, so £10 of CBDC would always be worth the same as a £10 note. CBDC is sometimes thought of as equivalent to a digital banknote, although in some respects it may have as much in common with a bank deposit. Any CBDC would be introduced alongside – rather than replacing – cash and bank deposits.


So, the Bank of England assure us that any CBDC will be used alongside cash. Let's investigate that a little more.


The Bank of England have been 'officially' investigating a CBDC since 2014


Sources

Bank of England on CBDCs

Bank of England 2014


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Who is deciding we need CBDCs?


The Bank for International Settlements


Who are the BIS?


Our mission is to support central banks' pursuit of monetary and financial stability through international cooperation, and to act as a bank for central banks.


Who owns the BIS?


Established in 1930, the BIS is owned by 63 central banks, representing countries from around the world that together account for about 95% of world GDP.


Who owns the Central Banks?


This is not as easy to answer, let's take the BoE for example. The BoE explain the history here which I urge you to read. If you're reading this after the 'Understanding Money' blog, I hope you read the BoE explanation with a note of scepticism.


What do the Bank for International Settlements say on CBDCs?


Read there papers from 2017:

r_qt1709f
.pdf
Download PDF • 234KB

Let's watch a scripted discussion they hold for the people:


Did you hear what Augustin Carstens said at around 22 minutes?


“We don’t know who’s using a $100 bill today and we don’t know who’s using a 1,000 peso bill today. The key difference with the CBDC is the central bank will have absolute control on the rules and regulations that will determine the use of that expression of central bank liability, and also we will have the technology to enforce that.”


This little slip from Augustin Carstens (the General Manager for Bank of International Settlements) suggests the CBDC's as a tool for eventually eliminating privacy.


The Bank of England also included this little nugget from this discussion paper:


"CBDC may be able to provide ‘programmable money’ through smart contracts. There would be a range of options for how this might be delivered."


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Why is 'programmable money' significant?


An article in the Telegraph, back in June, stated:


"Digital cash could be programmed to ensure it is only spent on essentials, or goods which an employer or Government deems to be sensible"


The article goes on to quote Tom Mutton, a director at the BoE:


"You could introduce programmability […] There could be some socially beneficial outcomes from that, preventing activity which is seen to be socially harmful in some way."


Governments and employers making sure the money they issue can only be used on “sensible” things, and not be used in “socially harmful” ways? It doesn’t take much imagination to see just how this system could evolve and re-shape society into a truly dystopian nightmare. (Read more into how tyrannical the CBDCs could be used here.)


These developments cannot be taken lightly. The introduction of these CBDCs will be presented as innocent, convenient tools to make our lives easier. However, people must note that to give complete centralisation of digital money is most unwise, we must consider long term possibilities. This is a tool that COULD (will) be used to control everything we buy.


This is how the Green Economy will be governed - direct through your CBDC account. You will have a social credit score and your 'carbon credits' will be recorded. The Green Economy has only been created to justify this new economic/ authoritarian system.


Sources

How the CBDC will be used tyrannically going forward

Telegraph article

Doconomy


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More from the Bank of England


Real-Time Gross Settlement — an infrastructure we operate that holds accounts for banks, building societies and other institutions. The balances in these accounts can be used to move money in real time between these account holders.


Overview

The Real-Time Gross Settlement (RTGS) service is the infrastructure that holds accounts for banks, building societies and other institutions. The balances in these accounts can be used to move money in real time between these account holders, this delivers final and risk-free settlement. A programme of work has been established to deliver a renewed Real-Time Gross Settlement (RTGS) service. As set out in the blueprint, as well as replicating the functionality provided today, the new RTGS service will deliver a range of new features and capabilities for payments and settlements between financial institutions. More detail on when functionality is now expected to be delivered is in the Programme timeline below. We will continue to engage with the payments industry throughout the Programme, to ensure that the next generation of RTGS creates a world-leading payments service for the UK.

Why is it necessary to renew RTGS?

Renewing the service is necessary because the way payments are made has changed dramatically in recent years, reflecting changes in the needs of households and companies, changes in technology, and an evolving regulatory landscape.




This timeline suggests they are transforming their infrastructure ready for the roll out of a CBDC. Does this suggest the decision has already been made?


If we read an excerpt from this fantastic blog by Stephen Guinness:


"To access CBDC, customers would need to register with a provider. However, this would come with certain conditions. The identity of users would need to be authenticated, both to open an account and to make payments, in the name of protecting them against fraud and stamping out money laundering. Rights to anonymity would have to be waived.


As for how CBDC payments would be processed, the BOE mention that transactions between users of the same provider could go through their own systems and would not need to be ratified by the bank’s core ledger. But CBDC payments between two different providers – say Barclays and Santander – would need to go through the ledger, and by extension the BOE.


Connected to ‘Payment Interface Providers‘ is something called the ‘Application Programming Interface‘ (API). It is this that would permit private sector providers to connect to the BOE’s core ledger. Any unauthorised access would be automatically blocked, as only regulated firms would be granted entry."


It looks like the BoE are redesigning their infrastructure, primarily for the issuance of a CBDC.


By the timeline given in the RTGS plan, we should be witnessing the beginning of this from 2023-2025?


If the CBDCs are rolled out to the public, we will need to meet certain conditions as well, does this have something to do with a digital ID? A certain vaccine passport?


I wonder.


Sources

Bank for International Settlements

Bank of England

RTGS Bank of England

Stephen Guinness (I urge you to subscribe and read his blog)


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What would a country with a CBDC look like?


Lets go to China.


A sovereign digital currency being developed by the People‘s Bank of China (PBOC) has been used for more than 1.1 billion yuan (US$162 million) worth of transactions as part a series of ongoing pilot programmes, according to a deputy governor at the central bank...


...The currency is being used for multiple payment methods, including bar code, facial recognition and tap-and-go transactions, Fan said.

The government also used e-yuan red packets, in cooperation with the Shenzhen government, to reward about 5,000 medical and health care workers involved in the treatment of Covid-19, the disease caused by the coronavirus, Fan said. The electronic red packets can be used at designated merchants in Luohu. The central bank’s e-yuan, known as Digital Currency Electronic Payment (DC/EP), would further push the world’s second-biggest economy towards a cashless society by allowing consumers and businesses to pay for goods with e-wallets, rather than traditional banknotes...


...The digital currency also would give the PBOC the ability to trace and track economic activity in real time.


“Data is king,” Fan said.


How will this impact China? Well, back in China 2018, the Government banned millions of people from travel for social credit offences.

How could CBDCs affect the UK?


Read Stephen Guinness's blog here.


Sources


China CBDC

China Social Credit Scores

Stephen Guinness blog


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Think this will not happen in the West?


Then you need to visit Giesecke+Devrient - the leading biometric and digital ID technological company of the US and Canada. They are very keen to see the new CBDCs become 'programmable.'


Do not misunderstand what am I trying to say: The CBDCs will be used to create a social credit system. They will not admit this, but they will introduce it down the line. You must consider all possible long term consequences of every single policy these institutions propose.

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Other sources for you to read:


1. Mark Carney: Dollar is too dominant and could be replaced by digital currency


2. In 2020, the IMF issued their 'A New Bretton Woods Moment' campaign. Listen to Kristalina Georgieva, IMF Managing Director here.


3. More on Bretton Woods 2.0:


4. Steven Guinness - A terrific blog to follow for the United Kingdom economic news - PLEASE SUBSCRIBE AND READ HIS ANALYSES


5. John Titus of Best Evidence has a conversation with James Corbett:

I recommend subscribing to Best Evidence. It's fantastic information, with excellent sourced material.


6. Bill Gates is involved (just like he is in in everything else.) He was pushing this since 2012.

Better Than Cash Alliance: Empowering People One Transaction at a Time


7. Miles Harris, CBDCs broken down:

More from Miles here.


8. George Gammon, Digital Currencies explained:


More from George here.


9. The Programmable Finance Issue

More from Martin here.


10. Whitney Webb and John Titus - The Banking Endgame

If this doesn't work listen here.

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My final thoughts


I hope you understood my breakdown of the CBDCs. This is only an introduction to the topic. Economics really is not that complicated, however the lingo these Bankers use make it hard reading.


Please do not dismiss this information. Reflect on it and read more about the CBDCs. Read about it yourself and listen to all the pros and cons. All of what is on here is mainly from the Banks own writings.


CBDCs are not just digital money on a credit card.


This is the precursor to a global economic reversal of spending power.


We are moving from the people making their own spending choices, to the unaccountable banking cartels making the choices for us. Can we trust them to have purely good intentions for our welfare? I would suggest history proves, absolutely not.


Centralisation of a physical banking system was bad. Centralisation of a digital banking system would be insane.


The only benefactors are the ones who control the system, not the people who rely on the system.