Neanderthal DNA may make people more – or less – susceptible to COVID-19, reported The Economist. It

Central Banks Are Introducing Digital Currencies.

In January, The Bureau of International Settlements (BIS) surveyed central banks and found most (86 percent) were considering central bank digital currencies (CBDC): 

“CBDC is different from cash, as it comes in a digital form unlike physical coins and banknotes. CBDC is also different from existing forms of cashless payment instruments for consumers such as credit transfers, direct debits, card payments and e-money, as it represents a direct claim on a central bank, rather than a liability of a private financial institution. This type of riskless claim also makes CBDC different from cryptocurrencies…or other private digital tokens…” 

The BIS defined cryptocurrencies as “decentralized digital tokens without an issuer that are not representative of any underlying asset or liability,” and private digital tokens as “…have an identifiable issuer or represent a claim and/or underlying assets.” 

There are many potential benefits of CBDC. The Economist reported: 

“Cashless transactions make for faster, more reliable payments and are less susceptible to counterfeiting. Issuing digital cash is cheaper than minting coins, so long as it is protected against hacking. Officials also have an easier time monitoring how digital money is used, making it harder to fund criminal activities. In poorer countries, central banks hope that digital currencies will bring unbanked citizens into the financial system, boosting economic development.” 

Central banks in developed countries have been slower to pursue CBDC than those in emerging nations. According to BIS, seven of the eight banks engaged in advanced CBDC planning are in emerging countries. China’s central bank is leading the CBDC charge among developed nations. It recently introduced the electronic Chinese yuan, or eCNY. 

When evaluating CBDCs, it’s important to understand how the currency operates. For example, Felix Salmon of Axios reported China’s eCNY: 

“…doesn't use blockchain technology. Instead, the ledger of who owns what is closely held at the Chinese central bank – and nowhere else…eCNY requires full trust of the Chinese monetary authorities. If it goes global, then China will at all times know exactly how much of its currency you possess – and could zero you out for any or no reason.” 

CBDCs may become part of the new normal that emerges as the coronavirus threat passes.

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Weekly Focus – Think About It 

“If this country is ever demoralized, it will come from trying to live without work.”

--Abraham Lincoln, 16^th U.S. President

   Andrew Zittell is a Registered Representative with and securities offered through LPL Financial, Member FINRA/SIPC.  Investment advice offered through Strategic Wealth Advisors Group, LLC a Registered Investment Advisor.  Yerba Buena Financial Partners and Strategic Wealth Advisors Group, LLC are separate entities from LPL Financial.