Hackers are definitely an issue, that is a given with everything that ends on the internet or connected to it. The software developers I know (who also work on the team responsible for managing Webster's online banking system) still agree that currency will inevitably go digital.
Kids have pocket computers, do they not? It makes sense to me that while they may not get credit, they may get their own bank accounts in their parents' name, and thus debit.
To discourage illegal transaction. More and more stores up to that point were refusing to handle cash anyway, so there's not much of a point to keeping it around. It's also more expensive to print money than the money is worth, another reason why I think it will eventually be phased out.
edited 12th Apr '11 4:18:59 PM by annebeeche
Banned entirely for telling FE that he was being rude and not contributing to the discussion. I shall watch down from the goon heavens.They don't need to outlaw any form of cash; It becomes useless if stores don't actually accept it.
edited 12th Apr '11 4:20:22 PM by Yej
But if it's still legal, then banks would still allow people to take out currency in physical—even though it can't be used for anything other than illegal transaction.
That and why continue to print cash if it's no longer useful in the legal economy? All it does is waste money and resources, and printing cash is already more expensive than the money is worth.
edited 12th Apr '11 4:25:33 PM by annebeeche
Banned entirely for telling FE that he was being rude and not contributing to the discussion. I shall watch down from the goon heavens.Actually, I looked into it just now, and it appears to just be an urban legend.
The lowest denominations (the penny and nickel) are pretty close to their actual value, though, and the lifespan of banknotes is really low, making money printing more expensive than it needs to be. (I say we should go the way most other currencies have gone and make dollar coins.)
edited 12th Apr '11 5:25:54 PM by annebeeche
Banned entirely for telling FE that he was being rude and not contributing to the discussion. I shall watch down from the goon heavens.a fully digital currency would pose some opportunities and challenges.
For example, hackers. I mean, come on, who wouldn't like to access their own account, and add a few zeroes to their balance. Thing is, that'd be counterfeiting, the unauthorised creation of new money, and an unregulated source of inflation. So that's one thing to think about
Another thing to think about, if money is completely digital, central bank interest rates just got a whole new bag of tricks: negative interest rates. Just the thing to stimulate spending if the economy's slumping. Spend it now, or it could disappear
but if the network goes down, everything's fucked
The terrible downside to multiple identities: multiple tax returnsDepending on how realistic you want to be, there is such a thing as a cryptographic signature, which is impossible to crack using any earthly computing device. (Since the space/time required is measured in trillions of universe-lifetimes.) Unless the bank itself is corrupt, that means hacking is impossible.
However, there is also such a thing as quantum money
. If you handwave away the drawbacks mentioned, then that would give you a system of money that is fundamentally impossible to forge.
edited 13th Apr '11 11:14:26 AM by Yej
Hacking wouldn't be nearly as big of a problem as you think, since every single transaction and the money accounts of the people making them can be monitored, and probably would be. Devising a computer system to sort through all these transactions and pick out suspicious ones would be quite possible, and no, you wouldn't be able to hack it, making it an "direct data must be incoming only and in a highly simplified, maybe even text only format" would make hacking extremely difficult without being on-site.
Giving out physical receipts would be a good idea though.
This is a signature. There are many like it, but this one is mine.Fully digital money would give the government a totalitarian amount of control over who spends what where. Your every transaction would be monitored, so say goodbye to any semblance of privacy.
Of course, the counter-economy would become its own separate economy immediately. You'd better read a whole lot on Agorism if you plan to make the fully digital money a big part of the storyline.
edited 14th Apr '11 5:25:41 AM by SavageHeathen
You exist because we allow it and you will end because we demand it.Exactly, which brings us back to scraps as illegal currency.
The great thing about your transactions being recorded, though, is the sheer amount of information flooding the banks and credit companies, so the only reason why anybody would look at your transaction history is if either the system or the law thinks there is something suspicious.
Now, there has to be a way to turn illegal money back into legal money if the crime organizations are going to be able to participate in the legal economy. I wonder how this can be done discreetly if all digital transactions are recorded?
Banned entirely for telling FE that he was being rude and not contributing to the discussion. I shall watch down from the goon heavens.Not really, people don't just pass money around, they use money as a medium for the exchange of other things. It's through those other things where opportunity for the laundering occurs.
Buy an extra bag of nails, are you going to count and see if it was used to build a house??
edited 14th Apr '11 12:28:56 PM by blueharp
Yeah, well regardless, most airline pilots still carry an E6-B flight computer
somewhere in their carry-on luggage. Why? Because nothing is perfect, some day some critical instrument will fail and then an analog system will be needed to get out of it. The same goes with economics, if you move totally to a cashless economy, something will eventually happen (hacker, virus, power-cut, line failure, etc.), and the whole thing will come crashing down.
edited 14th Apr '11 3:17:16 PM by MattII

My novel Project One Fifty-Four (a post-cyberpunk thing) takes place from 2039 to 2046. The book itself is written as if it was published in 2050 for a 2050's audience.
A detail I have already established is that money in much of the developed world has gone almost entirely digital. People use credit and debit numbers (usually from the pocket computer, only poor people still use cards) to pay for everything, and the only reason why scraps * still exist is for illegal transaction, and in fact, in some countries such as the US, China and the European Union, paper money itself has been phased out and made illegal.
I asked myself, how will these developments affect the economy and the black market?
My theory is that essentially giving the criminal population of the US their own currency will make them more powerful, and in fact organized crime already happens to be integral to my story's plot * .
My reasoning: There are lots of people, rich and poor, who will want scraps to buy illegal stuff, as well as a whole population of illegal immigrants (from countries that have not finished the transition to digital currency) and impoverished individuals who can't function in the legal economy at all, and must seek the illegal economy instead.
These people don't have scraps, so they have to get them from the ones that do. And what can the ones that have scraps do about it? Make money off of it, of course—legal and illegal money.
Now, economics is not my strong point. I'd like to know:
- Am I right, or am I missing something?
- So this is what the economy looks like now (EG, 2040's). What will it look like in the long run?
- How will this affect the global economy? Will this affect third-world countries, which are still using analog currency?
- Are there any sinkholes that I need to look out for?
Banned entirely for telling FE that he was being rude and not contributing to the discussion. I shall watch down from the goon heavens.