- Citizens will be forced to spend digital money and not save
- China’s current experiment is “capital controls” on steroids, when compared to 2013 Cyprus “bail-ins”
China is experimenting with digital money with an expiration date, meaning that citizens will be forced to spend and not save.
The “digital yuan” could usher in an era of total population control as people who aren’t allowed to save money will be more dependent on the government.
“Beijing has tested expiration dates to encourage users to spend it quickly, for times when the economy needs a jump start,” according to an article by the Wall Street Journal which practically endorses the Keynesian ideology behind China’s experiment.
“…China’s version of a digital currency is controlled by its central bank, which will issue the new electronic money,” the article added. “It is expected to give China’s government vast new tools to monitor both its economy and its people.”
When compared to the Cyprus “bail-ins” of 2013, in which thousands of people saw money in their savings accounts confiscated to “save” the island’s banks, China’s current experiment is “capital controls” on steroids.
“Beijing is also positioning the digital yan for international use and designing it to be untethered to the global financial system, where the U.S. dollar has been king since World War II.”
And, of course, because it’s a digital currency, people can’t use it outside the control of the Chinese government.
For the past several years, both China and Russia have been moving away from using the U.S. Dollar as a reserve currency, which could trigger a meltdown of the American economy as the U.S. has relied on global demand for the dollar to prop up its decades-long trade deficit.