Governor Andrew Abir, Deputy of Bank of Israel, recently explained that the nation has performed a pilot test of a new digital shekel, at the conference of the Fair Value Forum of IDC Herzliya, according to the Jerusalem Post.
Near the end of the panel’s discussion, Abir said that the Bank had already ran a trial for this new cryptocurrency. A panel seemed a bit surprised to learn this and asked: “You have already issued a coin?” Abir gave affirmation to the question.
Abir explained that he is, however, skeptical that this new central-bank digital currency (CBDC) would ever be launched.
I had previously estimated that the chance of having a CBDC within five years is 20%. My estimate has increased a bit in the last year, mainly because other countries are advancing with it too. But still there is less than a 50% chance.
Andrew Abir
The Bank of Israel said it has been preparing to launch a new cryptocurrency since May of this year. Since 2017, the Bank of Israel has been in talks of offering a digital currency, but has now made the decision to ramp up research and development for the potential issuance
in view of the rapid developments in the digital economy and in payments, and in view of the major central banks’ work on the issue.
According to the Jerusalem Post, ‘A CBDC would rely on distributed ledger technologies such as blockchain, but it would be different from the cryptocurrencies that are popular today, including bitcoin. The most important difference is that while cryptocurrencies do not belong to any specific country, and some are characterized by having no central authority to manage them, a CBDC issued by a country’s central bank would be regulated by the relevant state authorities.’
The option for a CBDC is still being examined, and when we made our statement last month, it was not to say what we are doing, but rather to share what we do not know and receive feedback from the public.
Andrew Abir
The payment system in Israel is at least a decade behind other countries. But in the last year, we have started to close the gap with the distribution of the infrastructure that allows contactless payments and the entry of digital wallets.
We are in the middle of a process of disruptive technology, and we do not know who are going to be the winners. Will it be the banks, credit-card companies, fintech or big technology companies? There will be changes in the next few years that we do not yet know about. But it is clear that the environment in five years’ time will not be the same as the environment today.
I’m sorry to tell you, but it’s not going to eliminate the banks. No central bank will introduce a digital currency for this purpose. The banks will still have an important part in the entire payment system.
Another thing that might disappoint you is that any digital currency of a central bank would not be designed as a kind of protection against bitcoin. What we are talking about is a payment system. Bitcoin is not a payment system, and it is not a currency. In the best situation, it is a financial asset, and in the worst case, it is a pyramid scam.
AUTHOR COMMENTARY
The crypto market has been walking on eggshells lately because more and more central banks are working on their own digital and cryptocurrencies, China being ahead of the curve with the announcement of their digital Yuan. Because of this, there are fears that the government will eventually crack down on Bitcoin, Ethereum, Dash, Dogecoin, Binance, Tether, XRP, Sushi, etc.; which has been suppressing prices on crypto across the board, as the U.S. government, and others, are tossing out threats of regulating these currencies.
You may have noticed that the IRS is starting to crackdown on the purchases of crypto, as the 2020 tax forms listed a new checkoff box that wants to know if you bought crypto so they can tax you.
What Abir said is true, that I do believe it is a pyramid scheme: you have to convince others to buy into it, and then those that bought it have to convince others also, hence, a pyramid scheme.
All pyramid schemes collapse eventually. At some point the government will all start banning them. I am not saying that will be tomorrow, but it will happen eventually, and there will be a LOT of people that will lose everything and then some because they dumped all their wealth into a currency that does not exist.
And, if you know anything at all about Bible prophecy, you know what the final end game will be:
[16] And he causeth all, both small and great, rich and poor, free and bond, to receive a mark in their right hand, or in their foreheads: [17] And that no man might buy or sell, save he that had the mark, or the name of the beast, or the number of his name. [18] Here is wisdom. Let him that hath understanding count the number of the beast: for it is the number of a man; and his number is Six hundred threescore and six.Revelation 13:16-18
[7] Who goeth a warfare any time at his own charges? who planteth a vineyard, and eateth not of the fruit thereof? or who feedeth a flock, and eateth not of the milk of the flock? [8] Say I these things as a man? or saith not the law the same also? [9] For it is written in the law of Moses, Thou shalt not muzzle the mouth of the ox that treadeth out the corn. Doth God take care for oxen? [10] Or saith he it altogether for our sakes? For our sakes, no doubt, this is written: that he that ploweth should plow in hope; and that he that thresheth in hope should be partaker of his hope. (1 Corinthians 9:7-10).
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