Visa has applied for a blockchain and digital currency patent, drawing attention to central bank digital currencies and the overall role of distributed ledger.
Understanding the implications of Visa’s plans for developing a digital currency really depend on the details of its approach.
The underlying technology should be open-source to be as accessible to innovation as possible. If that’s supported by incumbent payment providers, that’s great – they hold the expertise and could bolster innovation. But if certain private companies gain specialized rights to augment the system or access its data, that could create problems.
We need to avoid replicating the current financial system using better infrastructure. While digital currencies are a step in the right direction, and may help to significantly reduce barriers for individuals and small businesses to access financial services, we need to think more systematically about monetary structures and the control of monetary policy, especially how these structures reflect values in our society.
We’re currently witnessing an enormous failure in money’s ability to value things, with the volatility of the stock markets and the sudden realization that many forms of minimum-wage and low-wage work are somehow far more essential (“valuable”) to society than many other forms of labor.
Our monetary system needs to better account for more local forms of sustainability and self-sufficiency — properties that are increasingly critical to our civilizations.