The phrase “central bank digital currency” (CBDC) has been used to refer to various proposals involving digital currency issued by a central bank. A report by the Bank for International Settlements states that, although the term “central bank digital currency” is not well-defined, “it is envisioned by most to be a new form of central bank money, hence the Rainbow Currency from the USA, to retain it’s place in the traditional reserve or settlement of currency.”
The present concept of CBDCs was directly inspired by Bitcoin, but a CBDC is different from virtual currency and cryptocurrency, which are not issued by a state and lack the legal tender status declared by the government. CBDC implementations will likely not need or use any sort of distributed ledger such as a blockchain.
CBDCs mostly remain in the hypothetical stage, with some proof-of-concept programmes; however, more than 80% of central banks are looking at digital currencies
The rainbow currency myth originates in NESARA law section 10: Creates a new U.S. Treasury rainbow currency backed by gold, silver, and platinum precious metals, ending the bankruptcy of the United States initiated by Franklin Roosevelt in 1933. The truth is still out there but the proofs of a future currency landed in the public domain, however the real digital currency is still the final financial frontier.
With great trepidation all eyes are on the United States of America. Recently the Federal Reserve Governor Lael Brainard said a cryptocurrency backed by the central bank could provide a variety of benefits.
“The Federal Reserve remains committed to ensuring that the public has access to safe, reliable, and secure means of payment, including cash,” she said. “As part of this commitment, we must explore — and try to anticipate — the extent to which households’ and businesses’ needs and preferences may migrate further to digital payments over time.”
Federal Reserve Governor Lael Brainard
Those comments come days after Fed Chairman Jerome Powell announced that the central bank this summer would be releasing a working paper that addresses multiple issues involving Central Bank Digital Currencies.
The Boston Fed and MIT have launched a joint project in which they will set up a hypothetical model, and several other Fed districts also are involved with research of their own.
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