Type: Process Essays
Sample donated: Seth Foster
Last updated: June 17, 2019
Governmentsmay be in the process of banning the cryptocurrency space and using Bitcoin, whosecreation for years has been surrounded by a mysterious mist, as a first step, aglobal experiment to study the introduction of crypto.
Asa goal, they aim to allow the public to gain trust and familiarity withelectronic currencies before crushing private cryptocurrencies altogether, toafterwards replace them with one government-controlled cryptocurrency.Thisnew currency would utilize a blockchain that is under the complete control ofgovernment and would replace all physical currency. That is, banning physicaldollars and all privately issued cryptocurrencies and then impose a monetarysystem that is constituted entirely on electronic money, which is completelydominated by government authorities. Bydoing so, it would eliminate the underground economy and allow the currency toimpose any level of negative interest rate it sees appropriate to accomplishits inflation goals, while also preventing the public from hoarding paper moneyin order to escape the loss of its purchasing power.
The government would beable to monitor every transaction on the new currency blockchain under the pretextof being able to greatly decrease tax evasion, money laundering andterrorist-funding activities. Thisevolution in currency makes perfect sense to governments in their long historyof migrating away from gold-backed money. The primary purpose of government-createdcryptocurrencies will be to push interest rates into negative territory inorder to increase monetary velocity and supply.Otherwise,the authorities are just studying how cryptocurrencies develop, theirapplications and how people respond to them, to afterwards allow the centralbanks to take over.
It will appear that they regulate nothing and thateverything works alone, without “very bad bankers controlling everythingfrom the shadows”.