We reported back in November 2016 – Cashless World: 1 out of 3 People Never Use Cash
– fewer and fewer people understand the importance of using cash to protect
themselves from an overarching government warlord. At the time, China’s use
of digitized currency was growing at about 40% per annum. This means millions
of people each year freely hand over their cash and opt to use their cell
phone, online currency transfers or a plastic debit/credit card to make 100%
of their purchases. We see this as nothing short of happily going into the
gulag of digital enslavement.
Today we learned China is taking another step toward being a cashless
society. Not just any cashless society, but the largest populated nation on
the planet. Please keep in mind this announcement is coming on the heels of
China’s closest ally, Russia, announcing she would be issuing a crypto-ruble
– Which is a digitized currency as well. Once these two
nations go cashless that will be a huge blow to hard currency in circulation
around the world.
Yesterday, Cointelegraph
reported that local news sources in Russia had been informed by the
Minister of Communications, Nikolay Nikiforov, that President Putin has
approved a plan for the issue of a “CrypoRuble.” There was no detail,
however, on timeline and no any subsequent confirmation that we’ve seen.
Coincidentally, or not, Nikiforov is quoted as saying “I confidently declare
that we run (sic) CryptoRuble for one simple reason: if we do not, then after
2 months our neighbors in the EurAsEC will.” Source
As ZeroHedge reported
In a story that seems to have gone largely unnoticed by
the western press, the China
Daily reported that the PBoC has successfully designed a prototype that
can regulate its future supply of digital fiat currency.
In a report, “PBoC inches closer to digital currency”, the newspaper stated
that China’s central bank “has completed trial runs on the algorithms
needed for digital currency supply, taking it a step closer to
addressing the technological challenges associated with digital currencies,
according to a top official associated with the project.”
China’s has been preparing for digital currency since 2016. In June this
year, the PBoC “finished several digital money trials involving fake
transactions between it and some of the country’s commercial banks.”
Given over-invoicing of imports and the shenanigans in the shadow banking/WMP
sector, we suspect that the commercial banks took to these trials like
proverbial flies to feces.
The China Daily article goes on to suggest that, while there is no timetable,
“China is likely to become the first country that would deploy a
digital fiat currency.”
Far be it for us to question the accuracy of the China Daily – which
Wikipedia notes is often used as a guide to Chinese government policy – but
we were expecting Sweden (already the world’s most cashless society) to be
first. It has been widely reported that the introduction of an “e-krona” is
being investigated by the Riksbank. Forbes noted last month that “The inquiry
is expected to be finalized in late 2019.” It would not replace cash, which
accounts for 1% of transactions in Sweden according to a recent BBC report,
but operate alongside physical cash initially.
So…while China expects to be first, it will be “some time before the currency
goes public”. According to Di Gang, a senior engineer of the Institute of
Digital Money at the PBOC, a number of concerns need to be solved like
“managing risks and improving efficiency.” He added that “the
government also needs to factor whether the public would use the currency.”
We know the answer to that.
Yes, although it would be much quicker if Chinese citizens could somehow use
it to get their savings out of the country.
Back to the serious work of the PBoC’s Institute of Digital Money. Yao Qian,
the director-general no less, said that the successful simulation of money
supply had paved the way for the central bank to become the future sole
regulator and policymaker governing the value of digital currency. That sounded
like a veiled explanation for the recent heavy-handed clampdown on Bitcoin
trading in the Middle Kingdom. Indeed, the story notes that “ Unlike
Bitcoin or other digital money issued by the private sector, the digital fiat
currency has the same legal status as the Chinese yuan” Source
This sounds like a rebuttal to bitcoin and other privately issued cryptocurrencies
and a way for the Chinese government to begin the process of outlawing
private cryptocurrencies. It’s not just another major step in moving to a
cashless society, it’s a major step in attacking cryptocurrencies as they
continue to gain notoriety
We have been arguing these totalitarian governments, like China, the U.S.,
Russia and most other governments, are not going to simply hand over the
mechanism that produces their power and control. We are now seeing the first
real steps by a major government to maintain their control and power through
the issuance of currency. If the people want to enslave themselves through
the use of digital currency why wouldn’t the government be on board with that
idea and fully assist the citizens in their desire to willingly hand over
their sovereignty?
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Rory Hall, Editor-in-Chief of The Daily Coin, has written over 700
articles and produced more than 200 videos about the precious metals
market, economic and monetary policies as well as geopolitical events since
1987. His articles have been published by Zerohedge, SHTFPlan, Sprott
Money, GoldSilver and Silver Doctors, SGTReport, just to name a few. Rory
has contributed daily to SGTReport since 2012. He has interviewed experts
such as Dr. Paul Craig Roberts, Dr. Marc Faber, Eric Sprott, Gerald Celente
and Peter Schiff, to name but a few. Visit The Daily Coin website
and The Daily Coin YouTube channels to enjoy original and
some of the best economic, precious metals, geopolitical and preparedness
news from around the world.
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