HSBC Helicopter Drop – Blockchain and Central Banks the Future?

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Business Insider has reported that HSBS is discussing the idea that central banks could push for blockchain-based digital currency systems in order to capitalize on transaction transparency and create a clearer picture of a country’s financial system.

According to a draft document European markets editor Mike Bird obtained, UK banking group HSBC has outlined how it believes the blockchain could be used to facilitate or enhance unconventional central bank policies.

Bird writes:

According to a note from HSBC, central banks could use the blockchain for a policy that’s even more unconventional than quantitative easing. It could apparently make “helicopter drops” of money, sent from the central bank to households, much easier. The phrase comes from Nobel-winning economist Milton Friedman, who referred to dropping money out of helicopters decades ago, meaning a direct stimulus from the central bank that didn’t have to go through the private credit system.

Here’s how they think the blockchain could help with that:

If we move towards an economy where all transactions become recorded in real-time on a Blockchain type of technology, it will not be too dissimilar to the current eco-systems that many ecommerce giants have around the globe. Online e-commerce stores are able to give out loans to merchants without collateral, because they know all the flows already from the merchants’ point of view: from how much people are spending to the conversion rate of pages viewed to purchases. In the same way, a modernised monetary transmission system, based on real-time big data analysis through Blockchain, could allow the government to balance the economy more efficiently and systematically.

In short, the blockchain would allow the government to know a huge amount more about what’s actually happening in the economy.

Read full article with graphics here.

 

About Richard Kastelein

Founder of industry publication Blockchain News, partner at ICO services collective CryptoAsset Design Group (helped raise over $200m+), director of education company Blockchain Partners (Oracle Partner) and ICO event organiser at leading industry event  CryptoFinancing (first ICO event in Europe) – Richard Kastelein is an award-winning publisher, innovation executive and entrepreneur. He sits on the advisory boards of half a dozen Blockchain startups and has written over 1200 articles on Blockchain technology and startups at Blockchain News and has also published pioneering articles on ICOs in Harvard Business Review and Venturebeat.
 
Kastelein has spoken (keynotes & panels) on Blockchain technology in Amsterdam, Antwerp, Barcelona, Beijing, Brussels, Bucharest, Dubai, Eindhoven, Gdansk, Groningen, the Hague, Helsinki, London, Manchester, Minsk, Nairobi, Nanchang, San Mateo, Shanghai,Tel Aviv and Venice. His network is global and extensive.
 
He is a Canadian (Dutch/Irish/English/Métis) whose writing career has ranged from the Canadian Native Press (Arctic) to the Caribbean & Europe. He’s written occasionally for Harvard Business Review, Wired, Venturebeat, The Guardian and Virgin.com and his work and ideas have been translated into Dutch, Greek, Polish, German and French.
 
A journalist by trade, an entrepreneur and adventurer at heart, Kastelein’s professional career has ranged from political publishing to TV technology, boatbuilding to judging startups, skippering yachts to marketing and more as he’s travelled for nearly 30 years as a Canadian expatriate living around the world.
 
In his 20s, he sailed around the world on small yachts and wrote a series of travel articles called, “The Hitchhiker’s Guide to the Seas’ travelling by hitching rides on yachts (1989) in major travel and yachting publications. He currently lives in Groningen, Netherlands where he’s raising three teenage daughters with his wife and sailing partner, Wieke Beenen.

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