The establishment organ, The Financial Times, via columnist Martin Sandbu, is now promoting e-currency controlled by central bankers.
E-cash: coming soon to a wallet near you
Regular Free Lunch readers will know our sympathy with proposals for central banks to take over the role of money creation (a public good if anything is) from the private sector. They would do so by giving individuals and companies a convenient way to hold official digital money (as they already offer banknotes and coins) instead of deposits with private banks..E-currency adoption by central banks would be a very serious step on the way to monetary socialism.
e-cash, because it can in principle be tracked, does not offer the anonymity of physical cash. This is of course also an advantage as it makes illicit business transactions harder...
The upshot is that e-cash is both much more useful and easier to implement than is often thought. Central banks should get down to business.
The idea that a central bank could easily determine how much e-currency is in a certain sector and re-allocate the currency based on the desires of the state is not a difficult scenario to imagine, if a central bank e-currency becomes the medium of exchange in the land.
Not good. Not good at all.