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The day we hand over our fiat for government backed cryptocurrency


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Formulating a Game Plan

I feel it's time to get bum off chair and put finger to keyboard once again. I write this on the back of an article about coronavirus in Iran. Did you know if you broke the coronavirus restrictions in Iran, you could be fined 10,000,000 Rials? That is about $37 dollars. No currency starts out using millions - it would be just unworkable! What happened for a currency to get there? It's a long story and I am sure the gold bugs and sound money posters can explain it later. Please note I have not done an extensive amount of research into government cryptocurrencies - there are going to be questions I will be raising to provoke thought rather than to answer questions.

So we know cryptocurrencies are here to stay, and we know governments (China, EU, Bank Of England) want to make their own cryptocurrency, which will probably mean we will paid in the new digital cryptocurrency, DC for short, in return for our hard labour. It will be legal tender to pay taxes and repay debts. We in the UK have been relatively fortunate with pound sterling (OK house prices not so much), but compared to places such as Iran or Venezuela, we're alright.

We'll need a strategy or some game plan for the day when we have to hand over our fiat savings for government backed digital cryptocurrency, to ensure we don't lose out. And I feel with the Great Reset, GR, some people are going to be disorientated and will lose out. Don't forget there are huge debts run up to pay for the pandemic.

Within 5-10 years, I think in the major economies, fiat, or let's call it analogue money will be gone, and we'll all be using government backed legal tender digital cryptocurrency.

I'd like to think of a worst case and best case scenario. In the best case we'll get 1 to 1 replacement of paper money, and bank account savings into the new digital cryptocurrency. In the worst case scenario it might be 2 to 1 who knows? This could happen to reset debts, and reverse a negative interest rate policy which will probably be in place by then.

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The New Digital Currency, will it be like a physical gold standard/Bitcoin or have no anchor?

Fiat analogue money backed by debt has been a boon for governments that have spent more than receipts from tax income. They can spend, spend, spend and kick the can further down the road. I draw you to the conversation in Margin call. People say they don't want this funny money, but if they did "take the foot off the pedal, the world get's really fair really f**king fast, and no one wants that. They say they do, but they don't." The beauty of fiat money is that you can spend a deficit, almost indefinitely, or some proportion of GDP. If most of the countries of the world are doing the same during the pandemic, it won't matter, there will be no currency crisis. In fact I haven't heard about a  currency crisis mentioned at all in the media, for years now. You won't be the worst looking horse that is going into the vat in the glue factory (thanks to a poster for that quote). You can quantitative ease (QE) to your heart's content.

_115235501_qe_boe-nc.png

https://www.bbc.co.uk/news/business-15198789

Now will a government backed digital currency be a strict fixed amount, or will they be able to QE at some point when it is necessary? I would think as politicians always like to promise more than they could ever deliver to win votes, it is going to be the later. What will this mean? It will of course there will be inflation down the line - maybe even people will use their DC once they are paid, and go out and buy Bitcoin to preserve their purchasing power. I don't think people or even governments have thought about this yet. The governments can't get rid of Bitcoin - China are cracking down on miners, but I think people still are using it. So what might happen to discourage people buying alternative cryptocurrencies - perhaps they might tax people heavily if they do a direct conversion of DC to something like Bitcoin. 

What is the upside for the average Joe when you compare fiat money and DC?

None if anything that I can see. DC has all the same problems as fiat, but they have infinitely more control. The only way to put it under the mattress is to take it offline and put it on a USB stick, and stick it under the bed? Is it possible to issue cryptocurrency with a time expiry on it? If you don't spend it, it could deteriorate? 

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Formulating a Game Plan I feel it's time to get bum off chair and put finger to keyboard once again. I write this on the back of an article about coronavirus in Iran. Did you know if you broke th

Don't know if this will work, cross quote from the deflation thread. So let's assume that the covid over-reaction is a precursor to moving us on to this CBDC, and that this is going to start to o

No one wants their dumbass gubbermint crypto because of ease of use, diversity scoring, unicorns, spiritual enlightenment and all the other gumf they talk about. People buy crypto because one of

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The new money is going to fix things.

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This is from "Underwhelmed" https://www.dosbods.co.uk/topic/15476-sunaks-economic-shock-warning/page/4/#elControls_950488_menu

 

https://www.oftwominds.com/blognov20/great-reset11-20.html

All the PR being spewed about The Great Reset is the final frantic flailing of a system that's drowning in its own excesses. The 50-year long era of the few enriching themselves as the expense of the many has ended, for the same reason eras of extreme exploitation always end--the elites got too greedy and overshot the economy's ability to sustain their rapidly expanding share of the income and wealth.

Put another way: the elites have cannibalized the system so thoroughly that there's nothing left to steal, exploit or cannibalize. The hyper-centralized global money control has run out of rope as the cheap oil is gone, debts have ballooned to the point there is no way they'll ever be paid down, and the only thing staving off collapse is money-printing, which holds the seeds of its own demise.

Allow me to summarize the only way The Great Reset envisioned by global elites can actually manifest: The Martians arrive towing huge meteorites of pure lithium and gold, and rather than incinerating the global elites, they hand the global elites the meteorites to further their concentration of wealth and power.

Short of that science fiction, this sucker's going down. The Great Reset has already run its course after 12 long years of artifice, fraud and trickery. So global elite shills, lackeys, factotums, toadies and apparatchiks--prepare for your Wil-E-Coyote moment of truth.

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I've been thinking about this a lot recently.

Something is coming, I can feel it, even if I can't fully understand or articulate it. I'm not the most clued up regarding financial and macro economic matters but I've come to realise that even I am way ahead of the average normie, who is largely oblivious to all of the stuff discussed on here.

The question I've been pondering then is how to use this slight advantage of awareness to protect myself?

 

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They will call it digital cryptocurrency but in reality it's the same as paper notes except just held on a computer.  So they can debauch it ie add a few zeros of QE any time they like plus they can see exactly how people use and spend it.  The excuse for doing away with paper money is that it stops criminals being able to launder money etc which I suppose is a point but the average person will have all their financial affairs monitored too.

Bitcoin cannot be diluted so it is the hardest of hard money which is why they don't like it as they lose control of the world's financial system.  Will the average Joe realise that government backed DC isn't the same as BTC?  Somehow I doubt it until it's too late.  Governments don't need a hard sell on DC as people don't understand money and digital cryptocurrency sounds as if it's a winner.  They will make it much easier to use DC than paper notes and coins until people give up the fight.

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Green Devil

Its coming but it will be as you say- digital. Itll be completely traceable and your average builder wont be able to work for cash. Itll be traceable Gov BS DC. So itll be much worse than the existing fiat. Printable at will but integrated with the latest digital payment systems, ie swift, credit card machines etc. Impossible to avoid taxes. 

The best case is that bitcoin keeps going and keeps increasing (hard money etc) and gives a few of us a chance to keep ahead of the printing press just for a while...

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https://coinmarketcap.com/headlines/news/respected-financial-historian-calls-for-bitcoin-integration-into-u-s-financial-system/

Respected Financial Historian Calls for Bitcoin Integration into U.S. Financial System

 

Financial historian and Milbank Family Senior Fellow at the Hoover Institution at Stanford University, Niall Ferguson, has penned a lengthy piece on Bitcoin which is getting noticed by the crypto community.

In it, the former Harvard and Oxford University professor commented on how the traditional naysayers and debunkers have softened their collective stances this year as the asset outperforms most other traditional investments.
 

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I think his son invested in Bitcoin. Anyway if this does happen - I don't expect Bitcoin to be the same as the Bitcoin we know today after the integration of the US Dollar. But the time before it, it will probably be much higher.

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goldbug9999
On 22/11/2020 at 19:52, 201p said:

Now will a government backed digital currency be a strict fixed amount, or will they be able to QE at some point when it is necessary?

"fixed amount" fucking LOL

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Yes, everyone starts off with new things with the best intentions. I'd like to work from the ground up, and start with an open mind. Most people won't think that the government may just add further supply to the currency pool.

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So the government have a dilemma. They can't get rid of Bitcoin. But they want to monopolise the money. 

We've been here before with gold. They could ban it. Or they could buy it all up and put it in a vault, and let people use a derivative fiat version of it. If the dollar were to adopt the Bitcoin, as Niall points to - it might work like this. The bearer of the digital currency has the promise to receive a piece of Bitcoin. Of course people generally won't redeem the coupon, and they could make it very difficult for an exchange for people to exchange the digital currency for actual Bitcoin. Try to obtain physical gold or silver at the Comex for example.

 

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goldbug9999
1 hour ago, 201p said:

Or they could buy it all up and put it in a vault

Can we at least keep the discussion within the bounds of some vague possibility, because really all this talking shite is getting tiresome. About 80% of bitcoin is in cold storage wallets i.e. not even connected to the internet so how the fuck exactly are they going to "buy it all up".

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Print the dollars and buy it? If you were in control of the dollar, what would you do?

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Edit - they don't need to worry about the Bitcoin in cold storage. They will want to manipulate the perception of it, at the margins being traded.

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goldbug9999
6 minutes ago, 201p said:

Print the dollars and buy it? If you were in control of the dollar, what would you do?

Impossible, the more they print the higher the price goes. I certainly wouldnt sell mine for any less that 10 times the current price and if I new some gov was printing like mad to try and buy it all I would hold out for more maybe 100x maybe more. Maybe not all, I mean if the government is printing to make it more valuable why wouldn't I just keep it ?.

Utter economic illiteracy to suggest this is possible.

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goldbug9999
11 minutes ago, 201p said:

Bitcoin maybe new. But power, and control of people is not.

At some point in the not too distant future the top bitcoin holder might be the richest people in the world with a lot of power. Perhaps some country will just say, hey you know what all move here and you pay zero tax and we'll use our military resources to protect you as long as you live here and spend money.

That country might even be the US.

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deathfunk

I still can't see why major economies and central banks are not purchasing crypto, at least in secret.

The total crypto MCAP is still beneath $1 trillion. The US debt is now above $20 trillion. Just spend a bit more on attaining crypto dominance and quit all this planet destroying perpetual growth debt based fiat nonsense.

I can only think some people have too much to lose.

 

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macca

Back to a gold standard. Crypto based currency?

The central banks don't hold Bitcoin,, But they do have gold.. The oldest money in existence

(Unfortunately that dip shit Brown sold half of ours.. Not that i am biased to any political party as they are all criminals in my book, fucking up the planet for profit and greed)

Central banks want Control, they don't have control of Bitcoin, but they can get governments to make laws on taxes of crypto and tracking of transactions through exchanges..

They will not allow their power to be taken away without a fight.. and will want something they do have,, which is gold..

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BoSon

Maybe someone will invent something better than bitcoin that the public will accept, that can be tied to physical items the public need. A produce backed crypto standard.

e.g. bread crypto where 1 crypto is always worth 1 load of bread, milk crypto where 1 crypto is always worth 1 pint of milk.

People can buy the cryptos they need, ensuring supplies in the future. Better long term stashing than filling a larder with produce that may perish before being used.

There can be a new digital type of corn exchange to trade cryptos where 1 bread crypto may be seen as worth 2 milk cryptos. There is no universal exchange rate but bartered between the buyers and sellers like an ebay of cryptos to meet supply and demand of specific products by specific producers.

Producers can sell the cryptos, generating income on future commitments by guaranteeing future supply of the product in exchange for the crypto, backed by some form of insurance in case the producer fails to fulfil the guarantee.

Let me know when this is available, I'll stock up on tins of baked bean cryptos so no need for the pallet space at home. xD

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Popuplights
4 hours ago, BoSon said:

Let me know when this is available, I'll stock up on tins of baked bean cryptos so no need for the pallet space at home. xD

Presumably you will store them with your tin foil hat crypto.

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goldbug9999
On 23/11/2020 at 16:06, janch said:

Will the average Joe realise that government backed DC isn't the same as BTC?  Somehow I doubt it until it's too late.  

I've spoken to quit a few non technical people about bitcoin, its limited supply is the one thing that everyone I've spoken to at least understands.

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jamtomorrow
5 hours ago, goldbug9999 said:

I've spoken to quit a few non technical people about bitcoin, its limited supply is the one thing that everyone I've spoken to at least understands.

CBDCs look set to arrive in the public consciousness around the same time the first significant effects of currency debasement are widely felt (i.e. painful inflation, interest rates creeping up).

It'll be interesting to see how that goes in the West, but if the knives are out for the Central Banks (and never put it past a populist to jump on a passing bandwagon), CBDCs are going to have an all-too-real trust problem.

What's Yellen's pitch going to be at that point? "Look, I know we bent USD over the table and desecrated it, utterly, but you can trust us *now* this <insert catchy name here> CBDC is gonna be just great and we definitely won't treat it bad, oh no. So please trust us. Please"

Meanwhile, Farage has been testing the crypto water in his recent "investing" videos. Straw in the wind?

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Dogtania

Honestly don't think it will be that hard a swing to a digital central currency.

Sure quite a few will have misgivings etc but not much choice.  Others will lap it up just accepting whatever crap there told is true.

Likewise will be an easy sell for many with bolted on rewards or incentives to use initially.  Or even debt forgiveness.

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wherebee

If I was running the government department in charge of switching to a digital currency, I'd go via the benefits and pensions route.

Introduce a DC for all state pension and benefits.  Broadcast it as under an anti-fraud measure.  Call it the E-pound.  Get the banks onside in terms of free conversions from DC into normal accounts - no real impact on pensioners day one.  Get the larger supermarkets to take DC tokens from benefit claimants.  Get Amazon to accept DCs.  Get Sky/Netflix to accept DCs.

Make it difficult to transfer DCs from individual to individual initially (anti-fraud!).

Then expand it over time to other government interactions.  Then allow individual to individual, once you announce you have the monitoring in place to catch fraud.

Then start to pay civil servants in Epounds.  If you keep the values aligned with sterling for 10 years, people will not care.  Then wither sterling by increasing admin costs, etc on businesses who don't use it.

After about 20 years, oldpounds will be seen the same as shillings and pence.
 

 

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goldbug9999
On 20/01/2021 at 13:53, BoSon said:

 A produce backed crypto standard.

It doesnt work, bitcoin only works because it requires no external reference to any data other than time so the network can achieve transaction finality that is impossible to externally influence. If you don't have that property, you just have digital fiat.

Also its impossible for governments to return to gold backed currency because they need to able to issue new units at will, now more that ever.

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