After a series of virtual meetings between Finance Ministers and Central Bank Governors of the G7, they recently published a ‘policy paper’ confirming that G7 Central Banks will ‘work together’ to introduce Central Bank Digital Currencies (CBDCs).
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G7 & Central Bank Digital Currencies (CBDCs)
Central Bank Governors of the G7, met virtually on 28 May 2021 and Finance Ministers met in London on 4-5 June 2021, joined by the Heads of the International Monetary Fund (IMF), World Bank Group, Organisation for Economic Cooperation and Development (OECD), Eurogroup, and (on 28 May) Financial Stability Board (FSB).
Amongst various topics discussed such as the ‘global economic recovery’, ‘Transformative effort to tackle climate change’ and ‘support’ to Low-Income and Vulnerable Countries, they also go on to discuss the highly controversial topic of Central Bank Digital Currencies (CBDCs).
In part 17 of the document published on govuk the they state that:
“G7 Central Banks have been exploring the opportunities, challenges as well as the monetary and financial stability implications of Central Bank Digital Currencies (CBDCs) and we commit to work together”.
What is Central Bank Digital Currency?
A central bank digital currency (CBDC) would use digital tokens and blockchain technology to represent a country’s official currency. Unlike decentralized cryptocurrency projects like Bitcoin, a CBDC would be centralized and regulated by a country’s monetary authority.
Why should I care about CBDC?
Central Bank Digital Currency is an easier way for Central banks and Governments to control the whole payment system by being able to easily track each and every transaction.
CBDC can also be ‘programmable’.
This means that this digital currency that could be stored on your own digital wallet on your phone, in theory could be programmed to give a negative interest rate if you save or even restrict what you are able to purchase, as well as having the ability to automatically take tax payments and more.
If you had your savings in CBDC and you made a transaction that could be seen as not in keeping with the terms of service, then there is potentially a risk of being locked out of your digital wallet or account.
It is also a way for Central Banks to compete with the ever growing demand for cryptocurrency.
G7 Finance Ministers and Central Bank Governors.
Under the section ‘Shaping a Safe and Prosperous Future for All’ the policy paper continues to reveal their intentions around CBDC stating:
“We note that any CBDCs, as a form of central bank money, could act as both a liquid, safe settlement asset and as an anchor for the payments system”
“We will work towards common principles and publish conclusions later in the year.”
It seems that Central Banks now want full and complete control of monetary transactions under the guise of it being more efficient for consumers.
With CBDC, financial privacy would be pretty much non-existent.
The Group of Seven is an informal club of wealthy democracies consisting of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States. The heads of government of the member states, as well as the representatives of the European Union, meet at the annual G7 Summit.
The UK is holding the G7 presidency for 2021.
Protect your wealth and financial freedom with gold and silver.
With the continued debasing of fiat currency via an even higher increase in the supply of central banks’ digital currency, you can choose to exit the fiat currency system with real money, gold and silver bullion.
Gold and Silver is a great way to diversify your investment portfolio as it offers a unique chance to store your wealth outside of the banking system.
Physical gold and silver has been a strong and reliable store of value for centuries.
Gold and silver bullion coins for example, are an ideal alternative to preserving your wealth and purchasing power as well as defending you financial anonymity.
Physical gold and silver gives you the opportunity to store your wealth outside of the UK banking and economic systems.
This makes gold and silver ideal for UK investors looking to preserve wealth against future recessions, market fluctuations, CBDC or bank failures.
Read more about Central Bank Digital Currencies here.