Please click the link to listen to the eleventh episode of my weekly crypto podcast ‘Two Minute Crypto‘. These are intended to be short, single-topic ramblings on some aspect of the cryptosphere. Comments and critiques welcome.
Two Minute Crypto – Wild Thoughts
Today I’d like to introduce the first of my ‘Wild Thoughts’ Series where I take a flight of fancy somewhere through the cryptoverse be it past present or future. For today’s episode, I’d like to contend that it will, in fact, be governments which unintentionally usher in widespread crypto adoption. It is my belief that in the next few years a number of large economy nations will introduce centralized state-controlled cryptocurrencies. They will do so for a number of compelling reasons, including lower cost, increased transparency for taxation, and extended control over economic activity.
State Crypto is the surveillance states best friend, it will allow already invasive tracking of the actions of citizens to be taken to a whole new level. The government will know how, what, where and when you spend your money. They will likely even try to code these state cryptos to be limited in exchange, so yes you may be able to exchange your Japanese Crypto Yen for US dollars but no you won’t be able to perform an atomic swap for non-state sanctioned cryptos. But here lies the opportunity, state crypto will suffer from the same ills of fiat, there will be no limit, more will always be made available and just like fiat they will not hold their value.
However, the citizens of these crypto nations will have already become used to using crypto through state-backed issue, making it a small step indeed to move into Bitcoin, Stellar, Nano and other decentralized currencies. State cryptos will simply be exchanged for some other fiat and then moved into crypto.
Perhaps at first, most people will accept the state narrative that this is simply new better money and one in step with the efficiencies offered by blockchain. The transparency of the currency will be highlighted, as will the minimal cost of production and issue. However, as it becomes increasingly clear that state-issued cryptocurrencies both enslave and fail to retain value – a tide of now comfortable users will make their way to decentralized systems and all thanks to the efforts of their governments to co-opt crypto and blockchain.
What do you think, a wild thought or is there perhaps something to it?
Thanks for listening.
*This hit the wires just after I finished recording: Russia’s Duma considering state backed stablecoin: