The last few days I have been listening to keynotes attending a European payments congress in Vienna, Austria. Among many issues presented against the use of the bitcoin – and hardly any in favor – form central banks, bankers, payment professionals and others two objections stand out: 1) volatility and 2) no central issuer involved who was governing the scheme.
My suggestion to them was that you tie in fiat money with block-chain technology by the central bank. Just like Mintchip in Canada, but then with a more promising technology.
Now in an interesting development it seems IBM is building a block-chain based platform for fiat currencies:
The company has been in informal discussions about a block-chain-tied cash system with a number of central banks, including the U.S. Federal Reserve, the source said. If central banks approve the concept, IBM will build the secure and scalable infrastructure for the project.
If you look at a cash bill as a unique number printed on a (paper) carrier with various attributes to proof the number is indeed unique you see in analogy the fiat money in the block chain technology to be a unique number that can be electronically carried with the number it self have the attributes to proof it is indeed a unique number.
Just imagine what the potential could be of electronic fiat currency cash!
Listening to the keynotes and reactions from attendees I am even more inclined to restate my bet via ECBcoin and BoEcoin next to FEDcoin?:
Looking at the general attitude towards Bitcoin and its regulations in the USA I would not be surprised at all if the FEDcoin will be issued within 5 years.
Will the ECB one day issue ECBcoins too? If so we will most probably also see BoEcoins too… (My bet: first FEDcoin, then BoEcoin and then ECBcoin)
Also Federal Reserve Bank’s Vice President and Research Director David Andolfatto acknowledged Ripple network for utilizing Bitcoin’s original ledger at its best. He focuses on how Bitcoin technology could bring genuine benefits to US central bank’s real-time settlement system: Federal Reserve Bank VP Acknowledges Ripple for Utilizing Bitcoin’s Original Ledger.