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RE: Seigniorage (and the impact of holding physical cash)

in LeoFinance11 months ago

That is true but you are talking about two different components.

The idea is that CBDCs have to be non interest bearing or else the capital will flow from commercial banks into the digital wallets. This would affect the banks ability to lend, causing economic stagnation from everything from business loans to mortgages.

Seigniorage is something different and not as applicable since the monetary system is much bigger than just the currency that people typically associate as money.

And most of it is in the private (read banking) sector.