A British journalistic trope involves the phrase “The pound in your pocket”, a derisory reference to the 1960s Prime Minister Harold Wilson’s use of it to try to persuade the public that a proposed currency devaluation wouldn’t affect them. Nearly six decades later not so many Brits carry physical pounds in their pockets as electronic transfers have become more prevalent, but the currency remains. So much so that the governor of the Bank of England has had to reassure the world that the pound won’t be replaced by a proposed “Britcoin” cryptocurrency should that be introduced.
Normally matters of monetary policy aren’t within Hackaday’s remit, but since the UK is not the only country to mull over the idea of a tightly regulated cryptocurrency tied to their existing one, there’s a privacy angle to be considered while still steering clear of the fog of cryptocurrency enthusiasts. The problem is that reading the justification for the new digital pound from the Bank of England, it’s very difficult to see much it offers which isn’t already offered by existing cashless payment systems. Meanwhile it offers to them a blank regulatory sheet upon which they can write any new rules they want, and since that inevitably means some of those rules will affect digital privacy in a negative manner, it should be a worry to anyone whose government has considered the idea. Being at pains to tell us that we’ll still be able to see a picture of the King (or a dead President, or a set of bridges) on a bit of paper thus feels like an irrelevance as increasingly few of us handle banknotes much anyway these days. Perhaps that act in itself will now become more of an act of protest. And just when we’d persuaded our hackerspaces to go cashless, too.
Header: Wikitropia, CC BY-SA 3.0.
A government can seize a digital bank note of yours without reaching in your pocket.
That’s why I’m against it.
It’s a crime in many countries to carry too much physical currency over a state or international border. We aren’t going back to the old days, the governments won’t let us.
It’s even a crime to pay with cash over a certain, lowish amount. Various European countries have a 3000 euro limit. Over that, it needs to be reported to the local tax agency.
granted there are legitimate fringe cases, but I believe the US limit for “monetary instruments” is $10,000.
For an article talking about how people don’t carry cash at all, I’d expect those routinely rolling with 10-large on airplanes etc are pretty rare.
The figured out how to steal physical money out of your pocket ages ago, by spooky action at a distance. It’s called currency debasement. The Romans did it so much you can detect particles of their lead in the arctic. Nowadays we call it inflation, and the best PR to dismiss it is to pretend it happens completely by accident
Also: OI MATE, YOU GOT A LOICENSE FOR THAT QUID? I’LL CLIP YOUR NOGGIN YOU CHEEKY BLOKE
You’re Dick Van Dyke and I claim my 5 pounds…
They can even take your money for ransom, called Kontopfändung over here, because you are poor and couldn’t pay something. Can happen to anyone at any moment, one false decision and you have ten years of counting every cent. Yes, there are P-Konten here in Germany, but they come with their own bag of troubles.
Ask me how i know…
It is not like the serial number of every single note that enters or leaves a bank is not scanned and recorded anyhow these days in pretty much every country. The only thing that will be new is the granularity of the metadata harvested. Cradle to grave the metadata of every single transaction will now be recorded.
If you think of money as people converting time from their limited life here on earth into something that can be easily be traded, then at one level it would be interesting to see the ebbs and flow from the ultra poor to the ultra rich.
For banks, it is a bit like changing from a 1 frame a day, or a week, film to 10000 frames a second.
“The only thing that will be new is the granularity”
You say this in a dismissive way, and it’s so bad that I almost have to think that it’s intentional. As if that granularity is merely a difference of degree, and not a fundamental shift in people’s lives.
It’s kind of like saying that the government can take your photo every couple of years for a driver’s license, so what’s the difference if they put a 60 FPS camera in your house? Of course for that metaphor they don’t have to, we do it to ourselves, and we will probably roll out further encroachments into privacy according to that wildly successful model.
I guess that’s the real question: why would central banks care to go on the record, when they can get you to do it to yourself and avoid all accountability? Strange.
About 95% (or more) of my transactions are cash. By occurrence, not value of course.
And I live in the Bos-Wash-Metroplex.
Paying $250 of the $500 in my pocket is a meaningful thing.
Waving a chip over a reader, which makes a virtual number count down some, is not.
Part of me wonders if the average American would have such insane credit debt if purchases on credit cards felt more “real”.
I’ve pondered the same thing. One of the more terrifying changes in my lifetime is the use of credit cards in slot machines. Not that the one-armed bandit was ever a good idea, but at least you ran out of quarters at some point.
If the amount you could spend a day was limited, or if you turned it into a game where you have points and lose some for spending over a set limit. Someone should do that.
I’ve gone back to using cash – it’s faster and easier.
Lately I notice how often I’m stuck behind some cockwomble futzing about with a phone for ages trying to pay for something.
Increasingly few of us handle bank notes much? Only by a strictly literal, pedantic, and very out of touch reading.
Meet a poor person for once in your life. They work almost entirely on folding money.
The real scary thing is that digital currency can be tracked continuously. If you spent a dollar is a strip joint, they know. If you buy weed even where it is legal, they know. If you are a regular drinker, they know. How long before the insurance company changes your rates based on the food you buy or the alcohol you consume? At least now cash is an option and credit card use is a choice. With all digital government controlled currency, any amount of privacy is gone for good.
The subtle yet very important difference between “authoritarian” and “totalitarian.” The impotent stuffed shirts in power today always prefer soft power.
“Meanwhile it offers to them a blank regulatory sheet upon which they can write any new rules they want…”
This.
“The state pinky-swears it won’t do what it is obviously gearing up to do, and has said over and over again that it’s something they’d really like to do.
They promise. For the moment. Of course they reserve the right to change their minds later, probably under another person’s face and regime name which they rotate out every some-odd years. They really can’t be held accountable for that!”