Benoit Coeure, head of innovation hub at the Bank for International Settlements (BIS), has asked central banks around the world to hop on the DeFi train.
Coeure, a French economist who served on the Executive Board of the European Central Bank from 2011 until 2019, is currently leading research on CBDCs for the BIS.
Posted Using LeoFinance Beta
How can the BIS and central banks want to get into DeFi and yet be against decentralized cryptocurrencies?
Posted Using LeoFinance Beta
Probably another concept they will try to pervert, much like what Facebook and company are trying to do with the Metaverse
Posted Using LeoFinance Beta
All centralized entities are now creating their own centralized versions to compete with the open and decentralized market.
Posted Using LeoFinance Beta
Yes they will. I think many of them ultimately either take over Ethereum or fork it so they can quickly replicate it.
Posted Using LeoFinance Beta
No doubt. When the centralized entities enter the mix, we see things completely perverted in the meaning.
They take what is sound and warp it to fit their needs, which tend not to be sound, at least for everyone else.
Posted Using LeoFinance Beta
They want to replace the current set of stablecoins with CBDCs. Finally, they have realized the value of this market. Don't want to miss DeFi BOOM!
Posted Using LeoFinance Beta
So FOMO is why central banks plus BIS are getting into DeFi. Everything they touch turns to lead, so I expect that it's going to backfire for them.
Posted Using LeoFinance Beta
They see the opportunity to make money.
Consider it this way. They can take Defi architecture and build upon it. This will give them the applications that everyone uses.
If going through the banks front end, who controls things even when built on DeFi?
Posted Using LeoFinance Beta
Some DeFi platforms will cash out and let big banks buy them out. That's like small startups choosing to be acquired established players in exchange for the big bucks or the golden parachute. In many ways, I can't fault them for taking the money and run.
If going through the front ends presented by the banks, it won't be DeFi any longer even if built on it.
Posted Using LeoFinance Beta
That's true. Money talks and I think some businesses will just take the easy way out and sell to big companies.
We'll probably see some of them being created with that sole intent. That's already true in the startup world.
Posted Using LeoFinance Beta
Look at all the cryptocurrencies which were launched to capitalize on the unbelievable-- literally-- rise of Dogecoin earlier this year. Shiba Inu looks like it's holding its own, but many of the imitators mooned and crashed back to Earth.
Dogecoin is a big-name cryptocurrency, and it can't be ignored anymore. People don't have to like it, but it's no flash in the pan. It's not going anyway. It's place in crypto is as secure as Bitcoin's and Ethereum's.
Posted Using LeoFinance Beta
In theory it's possible for inflation to occur without central banking. In practice, all inflation originates with the central banks-- they print the money, and they loan money into existence. Everything else about money is just side effects.
If central banks treat money this way, can you imagine how they will treat cryptocurrency and DeFi? I'm not even talking about CBDCs, either.
Posted Using LeoFinance Beta
And then they forget about those loans - BAD LOANS feeding the rich, the banks and the government.
CBDCs are no different. In fact now you can get traced so easily.
Posted Using LeoFinance Beta
CBDCs are surveillance tools made with the purpose of squeezing every last fraction of a cent of taxes from the people. It would be interesting to see how drug dealers and those engaged in illicit activities handle this environment. Under those conditions, they may turn out to be heroes by showing the rest of us what to do.
Posted Using LeoFinance Beta
Well...I agree with your postulate concerning governmental interference and intrusion into the cryptosphere, but inflation can occur without central bank interference - its called 'demand pull inflation' and basically is market inefficiencies causing inflation.
Posted Using LeoFinance Beta
Isn't the difference between demand pull inflation and central bank-induced inflation the fact that former is more limited in its effects than the latter? Hyperinflation as what happened in Weimar Republic Germany after World War I and in Zimbabwe earlier in the 21st Century was made possible by central bank interventions; no amount of demand pull inflation could have caused them.
Posted Using LeoFinance Beta
My comment was addressed to this statement you made.
While this is true so far in our history, the world has yet to see a total collapse of production units. Should there come a time production becomes impossible for whatever reason, just watch inflation kick in for the goods that do remain in the system. Economics 101 - no supply with a demand present equals an infinite price.
Posted Using LeoFinance Beta
My fear is that we may be the poor suckers to witness that event.
Posted Using LeoFinance Beta
I would submit that the US inflation issues of the 1970s and going into the early 80s was caused more by other forces outside of monetary policy.
The fact that we saw an oil embargo when the US was totally dependent upon OPEC caused a rippling effect through the economy. This caused the price of everything to go up since oil was at the core of most all economic activity in some way.
Also, the idea of hyperinflation is any currency outside some small nation is impossible. Technology is simply too much a part of the global economy, and it is growing.
Posted Using LeoFinance Beta
One other event in the early 1970s contributed to the economic woes which accompanied the OPEC oil embargoes: the abandonment of the gold standard by the United States (closing the "gold window"). Prices increased at a small steady rate before then, but after USD went pure fiat it was off to the races for prices. It took until the mid-1980s for prices to settle down.
While there is no gold to abandon this time around, pure mathematics will bring grossly indebted economies to their knees. It can't be a good for a nation to have its national debt exceed 100% of its CGP and a significant portion of its annual budget assigned just to pay interest on the national debt.
Since USD is the world reserve currency, the United States will be brought to its knees last. The suspense comes in seeing if it chooses to undergo a controlled glide or a spectacular crash-and-burn. With the current crop of elites we have, I expect the spectacular crash-and-burn.
Posted Using LeoFinance Beta
That's a good point
Posted Using LeoFinance Beta
Not really. The inflation of late is due to supply chain issue. We see inflation yet lending is contracting.
Friedman talked about all inflation being monetary in a stable velocity of money environment which was standard during his time.
We are far from that.
Posted Using LeoFinance Beta
Hypocrisy knows no limited.
They want DeFi with regulations and using their currency I guess.
Posted Using LeoFinance Beta
I don't think I have ever heard of the BIS before. But its nice to see that they are looking into Defi and I hope CBDC's don't happen.
Posted Using LeoFinance Beta
BIS is the bank of central banks. It supports central banks' pursuit of monetary and financial stability through international cooperation.
And they pushing CBDCs all over the world. ✌ Coeure is leading that research.
Posted Using LeoFinance Beta
Bank of International Settlements.
Think of it as the Central Bank of Central Banks.
Posted Using LeoFinance Beta
BIS is the bank of central banks. It supports central banks' pursuit of monetary and financial stability through international cooperation.
And they pushing CBDCs all over the world. ✌ Coeure is leading that research.
Posted Using LeoFinance Beta
Hop on = take over
That is what they will try to do. As always, we just need to keep building and innovating.
The more we get out there, the harder it is for them to control.
Posted Using LeoFinance Beta