Citizen Central Banking
"A Fed-issued and -administered digital dollar will be every bit as uniform and elastic as the Fed-issued and administered pre-digital dollar has been. Indeed it will likely be even more easily managed thanks to the superior tracking ability afforded by DLT. It will also, I predict, be something more: Because of the speed, reliability, and tractability of distributed ledger-tracked credits and debits, a Fed-administered payment ledger will render quite feasible something that would have been difficult, even if possible, until recently: what I elsewhere call ‘Citizen Central Banking.’
We shall soon be able to ‘cut out the banks’ as proverbial middlemen between our citizens and their central bank. All citizens will be able to maintain what I call ‘Citizen Accounts’ with the Fed. Not only will all citizens be ‘banked’—no one ‘unbanked’—in these circumstances, but the Fed will then have more potent monetary policy instruments at its disposal, as well, all while citizens enjoy greater banking privacy.
In the midst of recession or liquidity trap, for example, our central bank will no longer need supply cheap money to private banks and then hope they will lend it to ordinary citizens so as to prime the consumer spending pump. Instead it can credit our Citizen Accounts directly. The ‘pushing on a string problem’ that so plagued the Fed’s QE strategies in 2009-12 will be much diminished. By the same token—again, pun intended—when spending appears to be overheating and inflationary pressures loom, the Fed can simply offer or raise interest payments on Citizen Accounts.
Meanwhile, because it is under no profit-maximizing imperative, the Fed will have no incentive to sell consumer spending data as banks have. And the privacy protections that blockchain technology offers—the one salutary phenomenon connoted by crypto—will extend to all Citizen Accounts.
Direct central banking, in short, is thus apt to be far more effective, saving-friendly and consumer-friendly even than indirect central banking has been. And the new digital dollar—still Fed-issued, still Fed-administered—will make that more feasible than it ever has been." (https://stanford-jblp.pubpub.org/pub/wildcat-crypto-fintech-future?)