Some Things a Central Bank ' s Banker Doesn ' t Know about Monetary History

In February 2018 Agustin Carstens, the General Manager of the Bank for International Settlements in Basel, gave a speech at Goethe University in Frankfurt entitled “Money in the digital age: what role for central banks?” The speech quickly became notorious in the cryptocurrency community for its brusque dismissal of Bitcoin and other cryptoassets. Among other things, Carstens there called Bitcoin “a combination of a bubble, a Ponzi scheme and an environmental disaster.” A combination? One may judge the price of Bitcoin a bubble, but there is no other sense in which Bitcoin is a “Ponzi scheme.” The BIS being the central bankers’ bank, crypto supporters in responsemocked Carstens for merely representing the interests of national fiat currency monopolies in quashing potential competitors.More recently Carstens gave aninterview to a Swiss periodical, available in English translation on the BIS website, in which he reiterated his anti-cryptocurrency position. “It’s a fallacy to think money can be created from nothing” was one of the oddest claims he made there, given that fiat monies are closer than cryptocurrencies are to being gratuitously created. This interview too has provokedcriticism from crypto defenders.Overlooked in the debate over Carstens ’ dubious statements about Bitcoin and cryptocurrency have been the dubious statements he makes about historical forms of private money. I want to shine some critical light on those statements.Early in the speech...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs