I'm not sure what to think of this. Does a central bank backed digital currency still require proof of work? I didn't dig too deep but didn't see anything explaining what the structure would look like (I guess that's part of the process of determining what's appropriate).

If you access via an app, would it be open like bitcoin where anyone can maje an app, or would you have to install an RBNZ app only available on Google Play and the Apple App Store?

My initial thought was I wouldn't put much money in it, but then realised it's intended to be a form of cash and I don't keep much money in cash either.

So I guess if they do a good job I might use it for small transactions?

[–] [email protected] 3 points 7 months ago (1 children)

I would assume this has little to do with traditional cryptocurrencies, but uses Blockchain as it's leger.

If I were in charge of this project, I would have a centralized validation system, maybe a series of servers across the country for redundancy. It doesn't need PoW or PoS as all validation is run by the RBNZ.

As for what this solves, I can think of a few things:

Opening up fiat interaction with other cryptocurrencies
Much lower fees for digital transactions
Near-instant transactions
Physical storage of digital funds. Paper wallets and other secure methods
From the govt point of view, perfectly tracible cash transactions

[–] JamesNZ 1 points 7 months ago

Yes, this.

[–] [email protected] 3 points 7 months ago (2 children)

The reason for proof of work is because true currencies are tied to labor, or more accurately, the potential amount of labor that can be converted from stored energy.

Now, a computer solving a math problem at a predetermined interval is not actual labor, but it does consume energy, and thus, currently the system is you have to spend real labor to purchase pretend labor, and you aren't even getting the labor out of it, you are getting a token assuring you the labor actually happened.

Unless the computers are actually producing anything, I'm not sure how to get around this issue.

[–] [email protected] 4 points 7 months ago (1 children)

Sounds like it's not independant crypto, but instead more like a bank account run by the government.

[–] [email protected] 2 points 7 months ago

You're not wrong..

forr example PRC's digital Yuan / Renminbi

https://www.adb.org/publications/the-peoples-republic-of-chinas-digital-yuan-its-environment-design-and-implications

[–] JamesNZ 1 points 7 months ago

Wtf are you on about? Proof of work is to keep the distributed ledgers honest. You need it if you are running a trustless system. If it is a central ledger, which it will be if a government is running it, then there is no need for proof of work.

[–] [email protected] 2 points 7 months ago

You can use premined currencies like XRP. You can just fork the protocol.