World’s Central Banks Can’t Ignore the Bitcoin Boom

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Bloomberg: The analysis comes at the end of a rough week for digital currencies, with JPMorgan Chase & Co. chief executive Jamie Dimon calling bitcoin a “fraud” and China moving to crack down on domestic trading of cryptocurrencies.

But with bitcoin and others gaining in popularity as payment systems go mobile and investors pour in money, central banks are beginning to delve into them and their underlying blockchain technology, which promises to speed up clearing and settlements. At the Bank of England, Mark Carney has cited cryptocurrencies as part of a potential “revolution” in finance.

To better understand the system, the Dutch central bank has created its own cryptocurrency, albeit for internal use only.

According to the BIS, one option for central banks might be a currency available to the public, with only the central bank able to issue units that would be directly convertible with cash and reserves.

Opinion: Despite Jamie Dimon’s assertion that cryptocurrencies are a fraud, the BIS (Bank for International Settlements) does not agree. And just in case anyone thinks that the BIS is no biggie, think again. The BIS is the ‘central bankers’ banker.

If that sounds confusing, you’re in good company.

From our post December 26, 2013:

“I have to admit that Bitcoins are new ground. Since Central banks can only regulate currency issued by and settled at banks, Bitcoins are out of the governments’ reach, so far.

The success of Bitcoins may convince governments that a move away from paper currency to a limited amount of regulated electronic currency could be a viable replacement for the US dollar as the world reserve currency.

A cashless society would give a government absolute control of commerce, as found in Revelation 13:16-17.”

What happens to existing cryptocurrencies if/when the BIS creates its own as the Bloomberg article suggests? Perhaps a new Bitcoin black market creating the need for governments to build some sort of permanent mark on the hand or forehead …