Cash Is No Longer King: The Phasing Out Of Physical Money Has Begun

Tyler Durden's picture

Submitted by Shaun Bradley via,

As physical currency around the world is increasingly phased out, the era where “cash is king” seems to be coming to an end. Countries like India and South Korea have chosen to limit access to physical money by law, and others are beginning to test digital blockchains for their central banks.

The war on cash isn’t going to be waged overnight, and showdowns will continue in any country where citizens turn to alternatives like precious metals or decentralized cryptocurrencies. Although this transition may feel like a natural progression into the digital age, the real motivation to go cashless is downright sinister.

The unprecedented collusion between governments and central banks that occurred in 2008 led to bailouts, zero percent interest rates and quantitative easing on a scale never before seen in history. Those decisions, which were made under duress and in closed-door meetings, set the stage for this inevitable demise of paper money.

Sacrificing the stability of national currencies has been used as a way prop up failing private institutions around the globe. By kicking the can down the road yet another time, bureaucrats and bankers sealed the fate of the financial system as we know it.

A currency war has been declared, ensuring that the U.S. dollar, Euro, Yen and many other state currencies are linked in a suicide pact. Printing money and endlessly expanding debt are policies that will erode the underlying value of every dollar in people’s wallets, as well as digital funds in their bank accounts. This new war operates in the shadows of the public’s ignorance, slowly undermining social and economic stability through inflation and other consequences of central control. As the Federal Reserve leads the rest of the world’s central banks down the rabbit hole, the vortex it’s creating will affect everyone in the globalized economy.

Peter Schiff, president of Euro-Pacific Capital, has written several books on the state of the financial system. His focus is on the long-term consequences of years of government and central bank manipulation of fiat currencies:

“Never in the course of history has a country’s economy failed because its currency was too strong…The view that a weak currency is desirable is so absurd that it could only have been devised to serve the political agenda of those engineering the descent. And while I don’t blame policy makers from spinning self-serving fairy tales (that is their nature), I find extreme fault with those hypnotized members of the media and the financial establishment who have checked their reason at the door. A currency war is different from any other kind of conventional war in that the object is to kill oneself. The nation that succeeds in inflicting the most damage on its own citizens wins the war. ” [emphasis added]

If you want a glimpse of how this story ends, all you have to do is look at Venezuela, where the government has destroyed the value of the bolivar (and U.S. intervention has further exacerbated the problem). Desperation has overcome the country, leading women to go as far as selling their own hair just to get by. While crime and murder rates have spiked to all-time highs, the most dangerous threat to Venezuelans has been extensive government planning. The money they work for and save is now so valueless it’s weighed instead of counted. The stacks of bills have to be carried around in backpacks, and the scene is reminiscent of the hyperinflation Weimar Germany experienced in the 1920s. Few Western nations have ever experienced a currency crisis before, meaning many are blind to the inevitable consequences that come from the unending stimulus we’ve seen since 2008.

In order to keep this kind of chaos from spreading like a contagion to the rest of the world, representatives are willing to do anything necessary, but this comes at a cost. Instead of having to worry about carrying around wheelbarrows full of money, the fear in a cashless society will likely stem from bank customers’ restricted access to funds. With no physical way for consumers to take possession of their wealth, the banking interests will decide how much is available.

The level of trust most people still have in the current system is astonishing. Even after decades of incompetence, manipulation, and irresponsibility, the public still grasps to government and the established order like a child learning how to swim. The responsibility that comes with independence has intimidated the entire population into leaving the decisions up to so-called  ‘experts.’ It just so happens that those trusted policymakers have an agenda to strip you and future generations of prosperity.

Some of the few hopes in this war against centralization are peer-to-peer technologies like Bitcoin and Ethereum. These innovative platforms have the potential to open up markets that circumvent state-controlled Ponzi schemes. The future development of crypto-assets has massive potential, but being co-opted is a real danger.

The greatest threat to individual freedom is financial dependence, and as long as your wealth is under someone else’s control, it can never be completely secure. Unfortunately, private blockchains are becoming increasingly popular, creating trojan horses for those just learning about the technology (in contrast, Bitcoin’s transaction ledger is public) . Without the decentralized aspect of a financial network, it is just a giant tracking database that can be easily compromised like any other.

The World Economic Forum released a report on the future of financial infrastructure. Giancarlo Bruno, Head of Financial Services Industries at WEF stated:

“Rather than to stay at the margins of the finance industry, blockchain will become the beating heart of it. It will help build innovative solutions across the industry, becoming ever more integrated into the structure of financial services, as mainframes, messaging services, and electronic trading did before it.”

The list of countries who are exploring integrating blockchain technology into their central banking system is extensive. Just to name a few; SingaporeUkraine, France,  Finland and many others are in the process of researching and testing out options.

For those who appreciate more tangible wealth, diversifying into hard assets like gold and silver is a great first step. It’s not about becoming a millionaire or getting rich quickly, but rather, using precious metals as vehicles for investment in the long-term. Regardless of what events unfold over the decades to come, the wealth preserved in physical form is more secure than any other asset. Forty years ago it was possible to save your money in the bank and accumulate interest over time, but that opportunity no longer exists. Those who fail to adapt to this new financial twilight zone will likely find themselves living as slaves to debt for years.

Control and confidence are two of the most important things in the system we live in. Once these digital spider webs have been put into place, the ability for an individual to maintain privacy or anonymity will all but disappear. Only through understanding the subversive actions being taken can people protect themselves from having to put their future in someone else’s hands. The cash that allows free transactions without tax burdens or state scrutiny won’t be around much longer. There will be many rationalizations for a cashless society in the years to come, but without fixing this broken financial system first, this will only ensure that despotism gains an even sturdier foothold.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
nuubee's picture

Accept the numbers I give you, serf, or go to jail!

J S Bach's picture

Cashless money is to currency what superconductivity is to electricity.

It is the usurers' wet dream.  This is why we must not allow it to happen.  Their nefarious system must be brought down entirely.  Debt-based currency must be abolished.  Money would then serve the people... not the other way around.

flaminratzazz's picture

and how indahell do we stop it? look around Bach ole buddy, they own our asses

Draybin Deffercon III's picture
Draybin Deffercon III (not verified) flaminratzazz Dec 9, 2016 5:39 PM

Viva la Bitcoin!!

TeamDepends's picture

When in doubt, turn to barbarous relics.

KittyKittyBangBang's picture

strang times ............. australian econonmist ..... definding paper money ..................HA HA HA

........we shuld do it strait a way ......@teamdeepens............ nice one 

stacking12321's picture

the author doesn't really understand bitcoin or its rise, as evidenced by the articles he linked to:

" The future development of crypto-assets has massive potential, but being co-opted is a real danger."

bitcoin's popularity has to do with rejection of centrally controlled closed-source currency.

sure the banks can make their own cryptocurrencies, but the market will reject their efforts as an inferior wanna-be with poor security that leaves peoples' wealth under the control of the same bankers that caused our current sad state of affairs.

Draybin Deffercon III's picture
Draybin Deffercon III (not verified) stacking12321 Dec 9, 2016 6:28 PM

Yes all their private cryptos will end like DECnet, IPX or Appletalk did.... Glad you caught that too... millions of Bitcoiners are not going to suddenly say, "you know what, actually I would like to have a centralized currency."

manofthenorth's picture
"Cash Is No Longer King: The Phasing Out Of Physical Money Has Begun"

Cash was NEVER king.

It was only ever a promissory warrant FOR real money.

REAL physical MONEY was phased out out in 1964.

Mr. Universe's picture

Trump will save us! from the evil Zionist Bankste...uh, never mind.

Rabbi Chaim Cohen's picture

Hyperinflation in a cashless society could be made to SEEM very different to the average person that it normally does. Hmm...

Moe Howard's picture

Exactly. Real physical money is made of gold and silver.

Paper is an I.O.U.

Digital is a an I.O.U. without the paper and totally out of your personal control.

Backin2006's picture

Stop using cards! You only give them the moral high ground.

MonetaryApostate's picture

I can't tell you how many times I warned this as coming.

KittyKittyBangBang's picture

youre butcoins are stupid .............@sticking12231 ...............totly unbacked ........nuffing their ...........if you dont hold dont own it ...........HA HA HA

Draybin Deffercon III's picture
Draybin Deffercon III (not verified) KittyKittyBangBang Dec 9, 2016 6:50 PM

I suppose you could say that all computer science seems "stupid" to ignorant half-wits.

KittyKittyBangBang's picture

didnnt say that @daybin ................. juts caus im a litle disleixic ........ dosnt mean i cant use tecknilgy ...........


.....butcoins are fake.... poofff all gone.........

stacking12321's picture

your being dyslexic has nothing to do with your being stupid, those are 2 entirely separate issues.

Omni Consumer Product's picture

fonestar, if you're going to keep coming back after being banned for your bitcoin douchebaggery, at least come up with a cool avatar. Otherwise get lost.

Mustafa Kemal's picture

"youre butcoins are stupid"

They are worse than that. I cant even hold them.  But we dont need no stinking 'smart money."

In addition to 

Au, $, Ag, Pb,

we stack BTC.

Draybin Deffercon III's picture
Draybin Deffercon III (not verified) HelluvaEngineer Dec 9, 2016 6:09 PM

No.. a Snider Enfield.

HelluvaEngineer's picture

The only Enfield I, ever shot was an Indian .308.  Man, it's...I mean was a piece of shit.  Canoe.

ThanksChump's picture

Not a fan of BB guns: Can't kill a humvee engine with a plinker like that.

Mr Poopoo Guy's picture

my Doctor won't take bitcoin , but he'll take cash or gold(cuase he can hold it!!!)

KittyKittyBangBang's picture

.............nice one @mrguy ............ butcoins... .....nuffing their .... totly fake 

JustUsChickensHere's picture

my Doctor will not take USD - so what us your point! (he wont take gold or Bitcoin either)

Different currencies are used bt different groups of people.

Draybin Deffercon III's picture
Draybin Deffercon III (not verified) Pinto Currency Dec 9, 2016 5:46 PM

There's gonna be a great party going on somewhere when your neighbourhood goes medieval...

flaminratzazz's picture

you made me spew on my screen!. thanks for the laugh

Draybin Deffercon III's picture
Draybin Deffercon III (not verified) flaminratzazz Dec 9, 2016 5:48 PM

Why? What is so funny?

flaminratzazz's picture

do you really think the bankers are going to allow some hashed data be in competition?

everything gets crushed.. these fvkers play hardball..

think.. if you were them, would you allow it?

Draybin Deffercon III's picture
Draybin Deffercon III (not verified) flaminratzazz Dec 9, 2016 6:02 PM

This isn't a question of what they will "allow". Basically, they are powerless to stop crypto. If they could have stopped it they would have shut it down like they did von Nothaus by now. That's the beauty of P2P networking, it's too big and complex to "shut down".

flaminratzazz's picture

they can print as much fiat as they need to buy it all. ever think of that? at the same time they can pressure anyone that deals in it.

Draybin Deffercon III's picture
Draybin Deffercon III (not verified) flaminratzazz Dec 9, 2016 6:09 PM

I suppose they could try but there's a limit to that. You're talking an infinite supply of fiat to by a limited quantity of BTC. Just like with gold, it would reach a tipping point.

flaminratzazz's picture

hmm  lesse here.. 20 trillion debt, 200 trillion unfunded liabilities with a quadrillion in derivatives.. does that look near unlimited fiat to you? what ever the float is in BTC believe me the FED can buy it.

KittyKittyBangBang's picture

.......................we allreay no that @flimyrazazz

JustUsChickensHere's picture

If they try to buy all Bitcoin, the price will skyrocket.

If they shut down (in ALL countries) the centralised on/off ramps there will still be over-the counter trade.

Doing both of those things would probably push a more privacy oriented crypto currency like DASH, XMP or ZCASH into a much greater market share, and they would have triggered a Whach-A-Mole process - that would be their worst nughtmare.


Still, suppressing Bitcoin is still fairly easy and possible for central banks

  • Just find some way to constrain its technical capablity as much as possible. Hmmm that has happened - block limit debate. A coincidence? Of course.
  • Recruit as many talented developers as you can, away from Bitcoin and into private projects using blockchains to improve legacy banking settlement systems. Starved of talent, Bitcoin growth wil remain very slow
  • Slowly accumulate large nation positions in BTC (just like physical gold) then keep pricing volatile to damage trust in all crypto currencies.
  • Alow on/off ramps to continue, but harrass them with ever increasing regulation.
  • Allow the price of BTC to continue to rise, but with wild swings, which prevents any other crypto overcoming the network effect and triggering a Whack-a-mole scenario
  • Rinse/lather/Repeat for a century. The couple of thousand Bitcoiners that you made wealthy will lose that wealth via normal errors they make, capital gains taxes and/or inheritance taxes on their death.

Upshot?  If CB's do recognize that this slow long term approach is an effective way to suppress the disruption that crypto curremcies could provoke, and act that way. For the people who get Bitcoin now and survive a lot of the next century, you are effectively getting paid by your local CB to HOLD BTC and slow any possible uptake...  'Money for nothing and the chicks for free' as the song goes.


Sam.Spade's picture

You could make the same statement about gold.  Or any form of equity money, for that matter.

And the arguments against your statment apply just as well for bitcoin as for gold.

Draybin Deffercon III's picture
Draybin Deffercon III (not verified) Sam.Spade Dec 9, 2016 6:19 PM

Yeah I was just thinking about how that would work. If they tried to print enough money to buy up *everything*? I'm sure it would end this thing and all the grief a lot faster!~

BigJim's picture

 If they tried to print enough money to buy up *everything*?

Whaddaya mean "if"? That's what they're DOING.

TPTB can't allow asset prices to drop. But there's no reason any sane individual would "invest" in bonds and (most) stocks at these valuations. Ergo, TPTB will keep buying more and more stuff with their fiat to prop the system up.

Unless they WANT a deflationary shock & collapse to flush more individuals out of their assets. A few months of that and then it's back to the races: fiat inflation as the sheep demand their "leaders" do "something".

Arnold's picture

Oldie, but Japan's Central Bank.


Not to lightly mention the European Central Bank bond buying.

They can't find enough to spend the QE on.....


And Proxy Federal Reserve buying through their Primary Dealers.....

flaminratzazz's picture

Look, maybe you think this coming war is going to have rules. I dont. I figure if the rulers fear for their loss of control, they will have no problem destroying the world.

JIT inventory is a huge Achilles heel they could use. One of many. ONE WEEK with a national power outage and some say it will never come back up. How hard will that be to orchestrate?

I put myself in their shoes, i Have my billion dollar bunker all setup, if these little piss-ants wont let me reign supreme, then eat each other for a decade and then lets talk.

Sam.Spade's picture

Money is just a means to an end.  The end is obtaining goods and services.  It you try to print your way to power, the limitation is that no one believes you and all your efforts get you nothing in terms of goods and services.  In other words, hyper-inflation will impoverish you very quickly while the rest of us are still growing food to eat or sell for something that you can't print, such as gold or Bitcoin.

I do agree with you that the coming war will not be fought by any rules and will be brutal.  But the paths to victory also won't be those used by our grandfathers.  In particular, control of commuincations, commerce, and information will be critical.

Not something that can be explained in a post, or by reading such convential thinkers as James Wesley Rawles.  If you want an idea on where it will really go, at least to start, get a copy of Thieves Emporium as I suggested in one of my other posts.

I do think you would like it.

flaminratzazz's picture

No matter how it changes it stays the same.. you can always pay half the people to kill the other half. grid down changes everything.

the only question I have is this: are these bastards crazy enough to let 100 nuclear reactors go critical?

Sam.Spade's picture

No.  You pay as few as you need to to kill the rest.  That way your money goes farther.

Until you print too much of it.  Then it stops buying anything for the few that are killing for you.  And they start killing you instead.

I recently ran across an excellent youtube on the subject of keeping power in a crisis.  I recommend it to anyone interested in the subject of how those in power stay there:

Rules For Rulers: