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The road to real-time settlement systems in the U.S. has been a long one. Whereas the UK introduced Faster Payments in 2008, it took another decade for RTP to be built, and five years on top of that for FedNow. Alas, the path to actual usage of these new real-time systems will be even slower, given the diffuse nature of the U.S. banking system and the hesitation effect that comes with having two competing networks.

"The immaculate adoption doctrine is wrong. CBDC will probably just be a middling payments product. Existing options like cash, insured deposits and fintech balances work just fine for most folks, CBDC adding no extra features to the mix. It's just not possible to take a middling payments product and launch it, effortlessly and immaculately, into wide adoption. A big and expensive marketing push from central banks will be required if CBDC is to ever be adopted, Jamaica's Jam-Dex being a good example. And even then there's no guarantee of success."

No other crypto-asset provides its owner with as much functionality as BNB. Is the sort of multi-functionality offered by BNB a feature that all assets will have in the future? Maybe not. Even if the technological problem is solved (as well as a legion of legal and regulatory issues), they may not offer end-users an ideal customer experience. The problem is that functions start to interfere with each other, the final result being that the total usefulness of the multi-functional asset is less than the total usefulness of the set of separate assets, each offering its functionality independently. So a multi-functional world may never actually emerge because people naturally prefer that functions be split apart.

"I think banks should be able to issue dollar IOUs on whatever digital substrate they see fit, whether that be an Azure SQL database, an Oracle database, or a blockchain. And they should be allowed to get deposit insurance for any of those dollars, regardless of the substrate on which those dollars are recorded. The medium should be irrelevant."

"The idea of crypto exceptionalism begins with the belief that crypto assets are fundamentally different from any sort of financial asset that preceded them. And so existing laws and regulations are inappropriate, (or "inapt," as described by Coinbase) and new rulemaking is required. This sounds right, at least on the surface, but it's a myth."

JP Koning writes that, before anti-money laundering laws arrived in Switzerland, anyone could walk into a Swiss bank and open an account without showing any ID. The bank would then issue you a bearer savings book. Ownership of the savings book was considered by the bank to be proof of ownership of the underlying funds in the account. The person who opened the account could keep the book or, if they wanted to, pass it on to someone else without notifying the bank, at which point this second person was now entitled to the underlying funds, who could pass the book on to a third person, etc. In essence, Swiss banks were issuing their own version of cash or stablecoins.

Back in 2021, El Salvador became the first country in the world to require its citizens to use bitcoin for payments. What have we learnt from El Salvador's four-year bitcoin experiment? JP Koning suggests that it definitively proved that bitcoin is not destined to be money. As far as making payments goes, bitcoin will always be an unpopular option, even when the government gives it a helping hand. And don't blame the IMF for this; bitcoin sputtered-out long before the IMF pressured El Salvador to drop it.

"When it comes to financial privacy, good old fashioned banknotes and privacy cryptocurrencies like Zcash & Monero get all the attention. But let's not forget about prepaid debit cards."

"I suspect that Libra is very much a work-in-progress. The current whitepaper seems to give only a hint of what the project might become. If so, one of the changes I suspect Facebook will have to make if it wants to get traction is to link the Libra network to already-existing units of account. A new unit of account is just too Utopian."

Starbucks has around $1.6 billion in stored value card liabilities outstanding. This represents the sum of all physical gift cards held in customer's wallets as well as the digital value of electronic balances held in the Starbucks Mobile App.* It amounts to ~6% of all of the company's liabilities.

"If Libra has its heart set on choosing an artificial currency unit as the basis for its global currency, it should have probably just go with the IMF's SDR basket rather than brewing its own strange currency concoction."

Despite bitcoin's downsides as a medium of exchange, a group of people that would choose bitcoin over fiat would be vendors that sell legal goods that are nevertheless cut off by mainstream payments networks. For example, MasterCard's Business Risk Assessment and Monitoring (BRAM) policy cuts out synthetic drugs, salvia divinorum, psilocybin mushrooms and spores, and nitrite inhalants.

"Bitcoin has become the first chain letter to go mainstream. It is the first chain letter to go global. Your sister is playing, your cousins are in, and so is your neighbour. We've almost arrived at the point where the normies are the folks who play bitcoin. The abnormal ones are those who haven't secured a spot in line."

Tether's poor stewardship of customer funds means that it is inexorably being replaced by safer stablecoins. Gresham's law, the adage that bad money pushes out good money, does not apply. The good is slowly pushing out the bad.

"While Dogecoin and Feathercoin seem like an entirely new phenomenon, I'd suggest that they're both really just an updated version of a fairly old financial instrument. You may remember those chain letters your parents used to get in the mail. "Send $5 to each person on the list, then copy it (adding your name to the bottom) and send to their friends," the letter would say. "Then wait for the money to flow in.""

Bitcoin is censorship-resistant. That's why ransomware gangs like it. This very same feature also prevents democratic societies from modifying the Bitcoin protocol to exclude ransomware gangs. Bitcoin may be censorship resistant, but the venues where it is traded are not. Section 311 and other tools that allow for leverage over these venues remain one of the best ways to attack bitcoin-based ransomware.

"Having just emerged from the fiasco of last year's coin shortage (which I wrote about here and here), the U.S. Mint has a new problem on its hands. The melt value of the nickel, or five cent coin, has suddenly moved higher than the coin's face value."

"The big waste theory calls for a ban on cryptocurrency. The vital cog theory calls for acceptance. Splitting the difference, why not fix the mistake of overconsumption by levying a yearly tax on the value of cryptocurrency holdings? Like a carbon tax, it would force mainstream users to internalize the costs of consuming decentralization. But unlike a ban, it would allow outsiders and hobbyists to continue to use decentralized products."

We often hear that modern money just isn't up to snuff because it isn't programmable. That's why we need Ethereum, stablecoins, and other exotica like central bank digital currencies. These platforms will provide the world with much needed programmability. However, we've had programmable money for ages. For example, programming COVID relief didn't require anything fancy like Ethereum or stablecoins. The card networks make it easy to do this sort of thing.