CURACAO NESARA GESARA: A Cashless Society in 2019

 


 

 CURACAO NESARA GESARA:  A Cashless Society in 2019

Abstract

The Cashless Society Working Party (CSWP) was formed late 2016 with a number of volunteers. Its first paper “A Cashless Society: Benefits, Risks and Issues” (referred to as “Interim paper”) formed the basis for a broader body of work. 
 
“A Cashless Society in 2018” continued Its global chronicle and presented the 2018 trends for the topic. The 2019 version focuses on the trends of that year. Only significant events or announcements are talked about, and only new findings are reported for the ones that featured in the 2017 and 2018 copies. 
 
This version was collated in the spirit of further developing knowledge, compared to previous years. The first chapter explores the events of 2019 which brought the geopolitical implications of payments to the fore: Facebook’s sudden announcement of plans to launch its Libra cryptocurrency with a consortium of companies caused consternation, uniting all regulators against the project and against the ongoing excesses of leading technology platforms as a by-product. 
 
 Beyond the headlines, cryptocurrencies have been gaining increasing acceptance, with more businesses preparing to receive them as payments. Regulators are adapting to the new reality with various approaches, while public authorities are under pressure to take enforcement action against money laundering and other crimes associated with anonymous cryptocurrencies. Behind the scenes, Central Banks have been exploring the potential for applying the technology that underpins cryptocurrencies to deploy digital fiat money, dubbed Central Bank Digital Currency (CBDC); 
 
this may take the form of a retail or wholesale instrument. As the Libra project challenged Central Banks’ authority on monetary policy, activity and research on the topic of CBDCs suddenly attracted attention in the midst of international tensions: China announced its readiness to launch a digital Yuan in the near future, emphasising the geopolitical dimension of currencies amongst a complex set of issues. The paper then revisits the key trends that were identified in 2018, to highlight significant developments in those areas. While technological developments were relentless, reliability and security of digital solutions remain core concerns. 
 
The implications of the data economy and the power of behemoth technology platforms over personal data and, potentially, financial transactions, focused the activity of regulators. The public is equally interested in the consequences of a surveillance state on democracy. The issue of financial exclusion and the effects of a less-cash society on poorer members of developed countries was an additional debate for legislators to consider how to tackle the viability of ATMs and the access to cash more generally. 
 
By contrast, some African Central Banks have been driving a digital payments and financial inclusion agenda. Ghana is now engaging in that journey. Finally, this paper reviews the log of risks and issues that were defined in the interim paper, in the context of the 2018 and 2019 developments. All have evolved to some degree, yet they are still relevant and require attention.
 

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