The Bitcoin revolution: The new ‘Bank of England’ is 'no bank at all'

摘要： The heirs to the Bank of England may think they’re still leading, but their only options are to follow crypto or get out of the way.

As one of the first countries to industrialize in the 1760s, Britain’s manufacturing revolution instigated one of the greatest practical and ubiquitous changes in human history. But even more extraordinary than the cultural shift itself, is the fact that Britain’s industrialization remained way ahead of potential competition for decades. Only in the early 1900s did historians come to grips with the issues of causation. Max Weber’s pithy answer, “the Protestant work ethic,” pointed to Puritan seriousness, diligence, fiscal prudence and hard work. Others point to the establishment of the Bank of England in 1694 as a foundation for financial stability.

In contrast, continental Europe lurched from one national debt crisis to another, then threw itself headlong into the Napoleonic wars. Unsurprisingly, it was not until after 1815 that industrialization took place on the European mainland, where it was spearheaded by the new country of Belgium.

250 years later, another revolution has begun with the launch of Bitcoin (BTC), but this one is more commercial in nature than industrial. Though the full impact has yet to play out, the parallels between these two historical events are already striking.

Bitcoin may not match the obviousness of industrialization, but the underlying pragmatics touch on the very foundations of the non-barter economy. Like the establishment of the Bank of England, the creation of the cryptocurrency infrastructure has been prompted by ongoing and worsening threats to financial stability: systemic fault-lines created by macroeconomic challenges stemming from the 2008 financial crisis.

If you can’t beat ‘em, join ‘em...right?

Where a central bank once anchored financial enlightenment, it now plays the role of antagonist. For those who could “connect the dots” in 2008, there was the realization that central banks no longer existed as guardians and protectors of national currencies, but rather as tools for creating politicized market distortions, abandoning their duty to preserve wealth in favor of creating the conditions for limitless, cheap government debt. While many of the underlying intentions were benign, the process inherently worked to punish savers and reward reckless debt.

Meanwhile, it has steadily taken time for the potential of digital assets to reach their potential and approach something like critical mass, though thankfully full acceptance shouldn’t take as long as Britain’s industrial revolution. Over the past 12 years, cryptocurrencies have moved from unknown to novel to significant, growing interest. As a result, profound changes are underway, affecting the mechanics by which investors, the investment industry, wealth managers and even the commercial banking sector are engaging with cryptocurrencies.

This interest has accelerated as we enter into a period of deep economic uncertainty and growing awareness that structural soundness is shifting away from traditional investment options. Not only that, this growing financial innovation and public interest has largely occurred outside of the central banks’ control, if not outright antagonism led by the banks’ regulatory arms in government.

Now, many central banks are trying to join a game they’ve tried almost every way of beating, with digital currencies that adopt the glowing sheen of crypto innovation, but which also eschew the underlying innovations and philosophy that made those innovations so popular to begin with.

......

詳見全文Full Text： cointelegraph.com

若喜歡本文，請關注我們的臉書 Please Like our Facebook Page： Big Data In Finance