Russian MP Proposes a Gold-Backed Cryptocurrency, Central Bank Head Concurs
Russian MP Proposes a Gold-Backed Cryptocurrency, Central Bank Head Concurs from CheckPoint Asia
TDC Note – More evidence of the coming change. More evidence that Russia is serious about getting out the Federal Reserve Note system. More evidence that a gold backed cryptocurrency is not only on the horizon it is racing down the hill towards the finish line.
Opposes nothing-cryptos, but will study the proposal for a gold-backed one
Editor’s note: The Russian MP has the right idea here. Gold has always been money, especially in world trade. On that timescale the Federal Reserve notes era since 1971 is just a blip which once it ends will be recognized as a mass delusion and the result of madness of crowds, a global Tulipmania only with far, far greater consequences.
It is good to hear Nabiullina is not opposed to the idea at all but promises to explore it. She remains more focused on national currencies, however, which is a mistake. Ultimately you don’t want to be holding your wealth in any paper that can be printed at all, but Central Bankers have an incentive not to go the way of gold-backed currencies.
To do so would impose harsh fiscal austerity on them, and greatly reduce their ability to help politicians with deficits, diminishing their societal prestige. They would go from monetary wizards and high priests to glorified warehouse clerks watching over the gold.
The Central Bank of Russia (CBR) is studying a proposal to create a gold-backed cryptocurrency, which could be used for cross-border settlements with other countries.
The bold proposal was made by Russia’s State Duma member Vladimir Gutenev. He has suggested initiating discussion to set up national cryptocurrency, denominated in gold.
Commenting on Gutenev’s proposal, the head of CBR Elvira Nabiullina said: “As for mutual settlements, we will consider, of course, a proposal on a cryptocurrency that is tied to gold. But, in my opinion, it is more important to develop settlements in national currencies.”
Gutenev explained that, unlike ordinary cryptocurrencies, which are not secure because they are not backed by anything, gold-backed cryptos have their value tied to a real asset. They would come in the form of a so-called stablecoin which is a type of cryptocurrency but offers price stability characteristics.