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Saturday, January 23, 2021
Home HSBC Helicopter Drop - Blockchain and Central Banks the Future?

HSBC Helicopter Drop – Blockchain and Central Banks the Future?

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.

 

Richard Kasteleinhttps://www.the-blockchain.com
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, the Netherlands where he has set down his anchor to raise a family and write. Founder and publisher of industry publication Blockchain News (EST 2015) and director of education company Blockchain Partners (Oracle Partner) – Vancouver native Richard Kastelein is an award-winning publisher, innovation executive and entrepreneur. He has written over 2500 articles on Blockchain technology and startups at Blockchain News and has also published in Harvard Business Review, Venturebeat, Wired, The Guardian and a number of other publications. Kastelein has an Honorary Ph.D. and is Chair Professor of Blockchain at China's first blockchain University in Nanchang at the Jiangxi Ahead Institute software and Technology. He has over a half a decade experience judging and rewarding some 1000+ innovation projects as an EU expert for the European Commission's SME Instrument programme as a startup assessor and as a startup judge for the UK government's Innovate UK division. Kastelein has spoken (keynotes & panels) on Blockchain technology at over 50 events in 30+ cities.
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