Cryptocurrencies, like Bitcoin, have been around for a few years and are still trying to gain mainstream acceptance. People are not willing to risk their hard earned cash on something that is new and difficult to understand. There are many experts who say that the cryptocurrency market is in a bubble and is likely to crash. People who depend on their money for survival are concerned that $1,000 in Bitcoin today may only be $500 or less next month.
The technological infrastructure behind cryptocurrency is blockchain. Blockchain is a distributed ledger. Distributed means that this ledger of currency and transactions does not exist on a single server but is distributed across multiple computers called peers that are connected together across the internet. The most important innovation of cryptocurrency is not the currency, but blockchain. Blockchain is being used for many other databases that people want to keep secure and available on the internet.
In the past few weeks, blockchain has gain a lot of acceptance at many different levels. The Chinese Central Bank is very close to issuing its own cryptocurrency. China put the currency on the fast-track after Facebook announced that it was part of a group that was going to launch a cryptocurrency called Libra. China has announced an initial seven businesses that will be issued the cryptocurrency.
PNC bank is one of the largest banks in the United States with over $400 billion in assets. On August 29 it was announced that PNC was now offering international payments via a blockchain network called RippleNet. This shows the growing acceptance of blockchain among mainstream financial institutions. One of the most profound effects this will have is bypassing SWIFT bank for making financial transactions across borders. It is both cheaper and quicker than SWIFT.
In addition to large international payments, smaller person to business transactions are also growing in acceptance. Retailers such as Petco are now encouraging blockchain transactions. And the large German bank, Commerzbank has entered into an agreement with Daimler Trucks to handle the payment transaction for the charging of its autonomous electric trucks. The payment is made from machine to machine with no intervention by a human being.
On August 22 through 24, the Federal Reserve Bank of Kansas City sponsored a summit in Jackson Hole, Wyoming. They talked about the normal things that you would expect central bankers to talk about such as trade policy, monetary policy and the global economy. But the outgoing governor of the Bank of England, Mark Carney, made a rather startling proposal. He suggested that it was time to consider a common international blockchain currency for monetary transactions. At this time the U. S. dollar is the dominant currency of international trade. It has held that position since the Bretton Woods Agreement in 1944 when other countries agreed to exchange rates pegged to the U. S. dollar. There have been serious calls for a new global currency for the last ten years or so. With the rise of the distributed ledger and the global internet, the technical infrastructure now exists to create a blockchain based world standard currency for trade.
Mr. Carney, in the past, has criticized Bitcoin but praised Facebook's Libra. Since the Jackson Hole meeting, it has been revealed that Carney and his staff held secret meetings with Facebook executives to discuss Libra. Any digital currency would probably be Libra-like but issued by an international monetary body. Central banks are not willing to give away their authority to a private company outside of their direct control.
One of the advantages mentioned in all of this is that traditional checking accounts would no longer be needed. A bank account is just an agreement between a person or other entity and the bank wherein the bank would keep a ledger of debits and credits to the account. The bank also provides security through the FDIC which insures the deposits. With a global blockchain based financial system, this function of a bank would no longer be necessary. All of your transactions would be kept on the distributed ledger and blockchain is a system that is designed to be secure.
All that would be necessary would be a means to reliably and securely identify yourself as the owner of the money in the digital account. Once again, blockchain has the solution. The United Nations already has a program in place called ID2020 that will give a biometric based digital identity to every human being on the planet. All of the identities will be kept on a blockchain.
It isn't a stretch to imagine that one day all people will be forced to use the global system for every financial transaction. And rather than keeping your personal keys on your phone, which can be stolen and hacked, is subject to malware and can stop working, the information could be kept on a chip stored securely under you skin. I don't know for certain that these things are going to happen, but there are no technical barriers to the system of the beast described in Revelation 13.
Also it causes all, both small and great, both rich and poor, both free and slave, to be marked on the right hand or the forehead, so that no one can buy or sell unless he has the mark, that is, the name of the beast or the number of its name.
Revelation 13:16-17 (ESV)
The Bank of England governor, Mark Carney, has challenged the dollar’s position as the world’s reserve currency, arguing that it could be replaced by a global digital alternative to end a savings glut that resulted in 10 years of low inflation and ultra-low interest rates.
Likening the move to the end of sterling’s command of international money markets 100 years ago, Carney said the dollar had reached a level of dominance that meant it was a barrier to a sustainable recovery.
He said a new digital currency backed by a large group of nations would unlock dollar funds that governments currently hoard as an insurance policy in uncertain times.