The future of the dollar

The future of the dollar

In today's blog article I wanted to cover a topic that I thought everyone should know about since it plays a big role in our lives. The future state of our money isn't going to be the same as it use to be in the past or in the present. I'm going to cover exactly what is going to change with our money and why this change is happening. So make sure you continue to read so you can fully understand where why what I'm about to discuss is going to happen. With all that being said and done let us get into today's article.     

The Digital dollar

Now if you've been keeping up with the recent financial news you would know that the U.S and China are trying to compete to make and produce the best digital money. China recently during the winter Olympics had started testing their digital currency by giving certain people access to it to use for payments during the Olympics. Pat Toomey A Senator from Pennsylvania stated that he was concerned with the digital yuan (The digital currency of china). His reasoning for his concerns was that the digital currency could bypass sanctions and could be a security concern. You might ask why are you bringing this up? Well, my reasoning is that we could see the use of digital currencies become more popular for countries of autocrats and corruption as a way to bypass sanctions placed on them.    

This is driving the united states to start the development of their own digital currency also known as a CBDC or central bank digital currency. The FED has been working on a CBDC through a project with M.I.T known as project Hamilton. The project has already developed an app and has been able to process up to 1.7 million transactions per second with the digital dollar. Most transactions are completed within two seconds of payment. In preparation for releasing the CBDC, the FED has asked the public to give them feedback on the project.    

The future of payments

The days of people paying with cash might soon come to an end. The reason I state this is because if this CBDC does roll out it would allow everyone to have access to digital payments. As of right now, most digital payments are done through banks. which is a problem in itself because not everyone has access to a bank. This is where the CBDC would come in because it would allow people to digitalize their money without having to go through a bank and would allow it to be done instead through the FED. We could also see more people instead of paying with their phone either through the FED app or through an NFC chip in the phone which most modern smartphones have nowadays. It seems the digital world is leaking over from cryptocurrencies to Fiat currencies only time will tell if fiat switches.    

The pros and cons

Now there are pros and cons to a CBDC and that's what I'm going to cover real quick for everyone. My first pro is this would allow faster and cheaper transactions and payments between people and businesses. The second pro is this would allow cheap easy international payments such as remittance between people. My third pro is it would allow unbanked people to get access to digital payments without having to go through a private entity. Now onto the cons with our first one being that all of this would be through a centralized authority. The second is it's open to cyber-attacks which can severely hurt commerce in the united states and internationally. My third con is your transactions can be tracked directly by the government as the FED is subjected to federal authority.   

My Final Words     

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