, 15 tweets, 2 min read Read on Twitter
0/ While regulators and lawmakers are focused on Facebook's Libra, the Wall Street banks are creating something much worse.

Time for a thread 👇🏽👇🏽
1/ Regulators and lawmakers around the world had a visceral reaction to Facebook's Libra because of concerns around sovereignty, KYC/AML, data privacy, monetary policy experience, and many other issues.

These are all valid concerns and Facebook should address them.
2/ Facebook's plan is to create a currency that is governed by at least 100 organizations, including geographic and industry diversity.

This inclusion of so many organizations decreases the likelihood that any one organization could be nefarious in nature.
3/ Wall Street banks do not want to lose their position of power in the financial industry, so they are not going to ignore the crypto industry.

In fact, many banks have decided to create their own digital currency.
4/ The banks are taking an alarming approach to creating digital currencies. They are:

- Acting alone in creation & governance
- Using unclear language
- Leaving the door open for major issues in future
5/ Wall Street banks are saying one thing, but doing another.

JP Morgan, Wells Fargo, and others continue to present their new digital currencies as digital dollars. In other words, each token is backed one-to-one by a US dollar.

But what are they actually doing?
6/ Not one bank has named their digital currency a digital dollar. They have called them JPM Coin, Wells Fargo Digital Cash, etc.

Could this be because they are precluded from using the word dollar? Or do they have hidden future plans?
7/ Here is the secret: Wall Street banks are not creating digital currencies.

They are creating central banks that they exclusively control.
8/ The banks are actively building "corporate central banks" in front of our eyes in an attempt to render the Federal Reserve ineffective or unnecessary.

Every banker wishes they controlled the Fed. Now they have found a way to do it.
9/ So how do they do it?

This is where Wall Street's plans get interesting.
10/ The Corporate Central Bank playbook:

1. Create digital currency
2. Back digital currency with dollars
3. Drive adoption of digital currency
4. Unpeg digital currency from dollars
5. Print digital currency at will

No one should trust Wall Street to play central banker.
11/ If Wall Street banks are allowed to create corporate central banks, they will create an enormous amount of systematic risk for the global financial system.

Regulators should step in immediately and stop this from happening.
12/ The corporate central bank playbook can be stopped with one simple idea:

Any financial institution that launches a digital currency that is pegged to an underlying currency or commodity cannot be unpegged from that currency or commodity in the future.
13/ If Wall Street has the best intentions, they should immediately agree to this.

If they have nefarious intentions, they will fight this.
14/14 Wall Street is building something much worse than Facebook's Libra. They are building central banks.

And it is financial institutions, not FB, that have failed to prevent money laundering, market manipulation, and fraud in the past.

Hopefully we have learned our lesson.
Missing some Tweet in this thread?
You can try to force a refresh.

Like this thread? Get email updates or save it to PDF!

Subscribe to Pomp 🌪
Profile picture

Get real-time email alerts when new unrolls are available from this author!

This content may be removed anytime!

Twitter may remove this content at anytime, convert it as a PDF, save and print for later use!

Try unrolling a thread yourself!

how to unroll video

1) Follow Thread Reader App on Twitter so you can easily mention us!

2) Go to a Twitter thread (series of Tweets by the same owner) and mention us with a keyword "unroll" @threadreaderapp unroll

You can practice here first or read more on our help page!

Follow Us on Twitter!

Did Thread Reader help you today?

Support us! We are indie developers!


This site is made by just three indie developers on a laptop doing marketing, support and development! Read more about the story.

Become a Premium Member ($3.00/month or $30.00/year) and get exclusive features!

Become Premium

Too expensive? Make a small donation by buying us coffee ($5) or help with server cost ($10)

Donate via Paypal Become our Patreon

Thank you for your support!