Actually they were a thorn in the eyes of the powerful people in the central banks. Digital currencies such as Bitcoin have not caused much more than head shaking and a little stomachache in the past. They are bad for payment because their value constantly fluctuates. If the private digital currencies go through, the influence of the central bankers, the ruler over the state money, also diminishes.
In the past two years, however, the wind seems to have turned. Around the world, central banks are experimenting with the technology behind bitcoin, the blockchain. Sweden and China are even thinking about introducing a state alternative to Bitcoin. The Russian central bank has developed its own technology, and the central banks in Canada and Great Britain are also intensively addressing this issue.
Bitcoin is mainly used by libertarians who do not want the state’s fingers to be in the money system. It is a strolling joke of the history that now excelled state banknotes could advance the technology and roll out a large area. But why are note banks so interested in the topic? The financial sector has been dominating the blockchain for years. This involves data sets, which in principle are glued together. Once saved, you can not change them. This ensures safety. At the same time, they are stored decentrally, on the computers of all users.
For example, financial transactions, such as the trading of shares, could soon be carried out via the blockchain. This should be faster, easier and more transparent than today. The government of Honduras’ developed with the technology just a new land registry, the old one was tamper-resistant.
Now the state banknotes have also jumped on the hype. When money changes the owner, this is already happening largely digitally, whether by credit card or online banking. However, only banks receive digital money from the central bank. Otto Normalverbraucher is only connected with the banknotes only if he uses the coins and bills issued by her. Because the less and less people do, they now want to arm themselves for the new world. The largest is in Sweden, where the use of cash is rapidly declining. Only one of six Swedes uses cash today, 2010 was almost every second. “We can not just stand by the side line and watch,” says Cecilia Skingsley, the Riksbank’s deputy, the country’s central bank.
In two years, one would decide whether a quasi-governmental bitcoin system is meaningful. “We do not care if people use cash, but if they do not, we have to offer alternatives.” You are still in the early phase, all options are checked. For example, each Swede could have an account with the Central Bank, where his e-crowns are stored. One could leave the deposit business also to private banks.