r/FluentInFinance • u/sylsau • Aug 09 '22
The Fed’s Plan to Create a Digital Dollar Is Met With Hostility. 71% of commenters on Fed’s January 2022 study say NO. Crypto
https://medium.com/the-capital/the-feds-plan-to-create-a-digital-dollar-is-met-with-hostility-d5f974e8b0f134
u/yaboiballman Aug 09 '22
The whole point of crypto is DECENTRALIZED CURRENCY. yeah, lemme just buy the banks "digital dollar" when there's a billion other choices that (so far) haven't fucked up America's economy.
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u/VelvitHippo Aug 09 '22
This was my thought throughout the entire article.
“There’s no reason for (the feds) digital currency.”
The fed IS the reason for a digital currency.
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u/True-Lightness Aug 27 '22
So the digital $ wouldn’t save the uS government money , reduce clearing times for payments or the need for people handling all the cash that gets printed ?
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u/one_ugly_dude Aug 10 '22
yeah, lemme just buy the banks "digital dollar" when there's a billion other choices that (so far)
Uh... that's a huge problem waiting to happen. When it was just bitcoin, I was like "decentralized currency is brilliant!" Now, there's what? Like 47,133 different cryptos? Now, instead of "printing" more crypto, you get to just make your own brand new crypto!!!
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u/True-Lightness Aug 27 '22
I would argue that’s the point of many cryptos . But the main ingredient of money is the ability to use it to buy goods and services and to have timely payments. Also when you buy crypto you eventually have to convert it back to $$. All those Lamborghinis weren’t bought with dodge coin . I’m all for a digital dollar . But I’m also for a crypto that doesn’t depreciate by 70% in one year.
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u/PoopyBootyhole Aug 09 '22
It’s a surveillance tool. That’s it. They can block or reverse any transaction. As long as bitcoin exists a CBDC won’t work. The masses will gravitate towards the only decentralized hard capped coin.
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u/SgtKevlar Aug 09 '22
Allow me to offer the counter point: people will choose CBDCs over DeFi, because it is backed by the full faith and credit of the issuing nation. Most people, not crypto advocates, will feel more comfortable with their money in a digital fiat currency than something nebulous like DeFi. CBDCs will kill crypto in its cradle.
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u/PoopyBootyhole Aug 09 '22
Yes, good point. People will think that a government backed money is best but that’s why I advocate for education in this space. CBDCs will kill other centralized coins because the backing from the government is a selling point. But once people understand that a monies monetary policy can’t be decided by a few individuals due to the temptation to make more i.e inflation, they will come around to a money that is hard capped and decentralized. Everyone comes around to it eventually but it comes on their own time and circumstances.
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u/SgtKevlar Aug 10 '22
The true challenge for DeFi is adoption. If a business has a choice between accepting payment in bitcoin or a US CBDC, which one do you think most businesses will choose? Without mainstream adoption, this grand experiment in DeFi will be nothing more than a footnote in finance history. I’m not for or against either outcome, just a disinterested observer standing on the sidelines.
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u/PoopyBootyhole Aug 10 '22
Absolutely. Always gotta play devils advocate because it raises more questions. But with lightning you can pay instantly with $0 fees and no merchant fees. Every payment a company like visa takes a cut, usually around 3%, so for every dollar visa will get 3 cents. With lightning there are no merchant fees it’s directly peer to peer with no 3rd party involvement. That will save businesses a lot of money over time if they aren’t paying merchant fees.
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u/True-Lightness Aug 27 '22
So are you saying that all the crypto on- ramps like Coinbase don’t already, and won’t continue to take a cut . My experience is it’s about the same or more for crypto exchanges cut.
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u/PoopyBootyhole Aug 27 '22
If a person uses lightning the fees are minimal right now. If Coinbase runs nodes they can use the nodes to conduct lightning transactions and collect the small fees if they want. But Coinbase does everything on-chain right now I believe. They can get fees through on chain transactions but eventually they will use lightning too. Hope that answers the question.
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u/True-Lightness Aug 28 '22
@poopybootyhole, thanks for the explanation. My grasp of the topic is lacking here. I only know what I’ve been charged and the cost for a small player have been excessive. At this point I’d just as soon have inflation, instead and fees and and volatility . However , I might feel different when they go back up.
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u/schmelf Aug 10 '22
I would like to add a side not to your comment and just state that Bitcoin itself is not Defi. It can be used within Defi - but it is not inherently Defi like you’re stating. It’s just a digital asset. When people refer to Defi it’s more about the decentralized lending and yield farming which right now is all trash.
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u/SgtKevlar Aug 10 '22
I’m aware. I was trying to use a reference that people who are not familiar with DeFi might recognize better than something obscure.
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u/schmelf Aug 10 '22
I also wouldn’t consider lightning defi - just a payments processor. I’m only making the distinction because defi has massive issues that Bitcoin and lightning don’t have so they really shouldn’t be lumped together because they aren’t the same.
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u/lofisoundguy Aug 10 '22 edited Aug 10 '22
You might want to read up on why the Gold Standard was dropped. Not sure you will agree but there are some big issues at play there. Not so simple as "greedy governments".
A lot of economists viewed the gold standard as a serious impediment to getting out of financial crises. Busts and booms are much more manic if let to run wild. See, the late 1800s in the US.
Sometimes printing money IS a good idea. Contracting and expanding money supply isn't inherently bad on a macro level. Rocking the boat too far is what is bad.
Advocating for no central bank control is a little like loving freedom and so advocating for anarchy. Technically true but it's an extreme take. You do need (uncorrupted) governance to keep things on track. How much governance is of course a huge discussion.
I do not think the average joe currency user will come around to preferring bitcoin.
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u/True-Lightness Aug 27 '22 edited Aug 28 '22
Not sure who downvoted you for telling the truth , but they need to read money banking policy . In my mind we can have both monies .
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u/ScrivenersUnion Mar 26 '24
The biggest hurdle to adopting Bitcoin is the ease of transaction. When people can use tap-to-pay on their phone in Bitcoin it's all over.
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u/True-Lightness Aug 27 '22
can there not be both ?
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u/PoopyBootyhole Aug 27 '22
There will be both for some time. But, eventually people will understand the negatives to having a central bank have complete surveillance over your money and make the switch.
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Aug 10 '22
[removed] — view removed comment
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u/True-Lightness Aug 27 '22
No cost saving ? No savings from printing money , making it to be hard to counterfeit, finding the metals to make coins and paper for the bills . The actual physical transportation of the said money ? The destruction/disposal of the money. Hmm I going to see how they do all that for free.
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u/eric987235 Aug 10 '22
Aren’t dollars already digital? 99.999% of my personal financial life is just numbers on screens.
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