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Sky News AU
20-07-2025
- Business
- Sky News AU
'Money that can expire': RBA laying groundwork for a dystopian financial reality where 'money is given a brain and then the switch is handed to someone else'
Something is happening to money. Not the kind of change you notice right away. The kind that takes shape quietly, in boardrooms and briefing notes. While Australians argue about interest rates and property prices, a different conversation is unfolding elsewhere—one that most people haven't heard, let alone been invited to join. In Basel, Switzerland, a group of unelected officials is reshaping the future of money. The Bank for International Settlements (BIS) doesn't chase headlines or need public attention. It shapes monetary policy by guiding central banks around the world. And Australia's Reserve Bank isn't sitting this out. Quite the opposite. Through a pilot called Project Pine, the RBA has begun laying the groundwork for a new financial architecture—one built not just on digital money, but on programmable money. And that distinction matters. Programmable money isn't just a digital version of what you already use. It's money with logic built in. Money that can be told what to do. Or what not to. Money that carries conditions. Parameters. Instructions. Money that stops being neutral. Now, let me clarify: I'm not here to scare you. But I am here to paint an accurate picture. We're witnessing a shift in who gets to decide how your money functions—how it moves, where it goes, what it touches, and what it refuses to. It's a shift in who holds the final say: the individual, or the system. Programmable money means every single transaction can be pre-shaped. Every permission can be baked into the code. And every restriction can be enforced automatically, without warning and without recourse. This is money that can expire. Spend it within 30 days or it disappears. The justification? Stimulus. Drive consumption. Keep the economy ticking. This is money that can be geographically constrained—valid in one postcode, invalid in the next. Use it in Sydney, fine. Try to spend it in Perth? Blocked. This is money that knows what it's being spent on, and money that can say 'no' when it doesn't like the answer. No gambling. No late-night purchases. No donations to flagged organisations. No payments to 'non-compliant' vendors, not because you did anything wrong, but because the system doesn't approve. And this system doesn't need a debate in Parliament to make those changes. It just needs a policy tweak. A regulatory update. A line of code. Taxation becomes real-time. No filing, no refunds, no deductions. Every transaction taxed at the point of sale. Rates adjusted dynamically. Levies introduced on the fly. You don't vote on it. You don't see it coming. It just appears. And if a purchase doesn't comply—if it violates the parameters set by regulators or AI-driven compliance tools—it can be reversed. This isn't a vision for the distant future. This is happening. Now. The BIS has published detailed technical papers on how programmable money can function. The infrastructure already exists. The pilots are underway. Australia was one of the first to sign on. The RBA's digital currency trial began last year. Since then, it has collaborated with international financial bodies and tech firms to explore what may soon become the foundation of a new global monetary system. A system where money itself becomes a tool of policy enforcement. None of this has emerged in isolation. This is not an isolated project. It's part of a larger trend—a slow, deliberate expansion of regulatory power that has taken shape over the past decade. Behind the scenes, Australia's financial regulators have been building the scaffolding quietly, incrementally, with no fanfare—just a steady layering of oversight, compliance, and surveillance. Anti-money laundering reforms. Digital asset frameworks. Know-your-customer mandates. Real-time transaction monitoring. Rules that, in isolation, sound reasonable—even necessary. But in aggregate, they form the machinery of a system capable of managing a national economy in real time. A system where intervention is no longer occasional—it's constant. Silent. Automatic. Built into the fabric of the transaction itself. That's how systemic change happens in a country like Australia. Not through sweeping public mandates. Not with dramatic declarations. But through regulation. Compliance guidelines. Policy notes. The kind of documents few people read, but which carry enormous weight. And there's another layer here: external pressure. Because Australia doesn't act in a vacuum. Its economy is plugged into a broader system of global finance. Step too far out of sync, and the penalties are swift—higher interest rates on the global market, reduced access to capital, reputational damage, and trade friction. That's not conspiracy talk. That's how modern financial systems work. It's why central banks and regulators around the world coordinate so closely. It's why 'global best practice' is more than a suggestion—it's a standard. A code. Deviate from it, and the cost is real. That's also why Australia doesn't just follow these international frameworks. It helps write them. Its regulators don't just attend global forums—they help shape the outcomes. They co-author the reports. They return home with policies drafted abroad and apply them domestically—often without public discussion, and usually without opposition. These imported frameworks arrive with the force of inevitability. They're wrapped in the language of modernisation, inclusion, resilience. But baked into them are assumptions about how money should work—and who gets to decide. Once embedded, these systems become hard to challenge—let alone reverse. Programmable money represents more than a financial upgrade. It represents a change in the relationship between the individual and the state. A change in how freedom is understood in a digital economy. Because when money becomes programmable, it becomes conditional. And when it becomes conditional, it becomes political. It can be used to shape behaviour, enforce compliance, reward the approved, and marginalise the disobedient. That's not dystopian speculation. It's a practical consequence of giving money a brain—and then handing the switch to someone else. None of this is an argument against innovation. When handled responsibly, technology can improve access, reduce fraud, and streamline operations. But the same tools that offer convenience can also enforce conformity. And the more invisible that enforcement becomes, the less room there is for dissent—and for freedom. Australians deserve to understand what's being built before it's too late to ask why. The questions should come now, while there's still the opportunity to ask them. John Mac Ghlionn is a researcher and essayist who writes on psychology and social relations. He has a keen interest in social dysfunction and media manipulation.
Crypto Insight
28-05-2025
- Business
- Crypto Insight
How central banks are testing blockchain-based monetary policy
Tokenized monetary policy means that the liabilities and assets a central bank uses to steer short-term interest rates exist as programmable tokens on a distributed-ledger platform. In such a token arrangement, what the BIS describes as an ecosystem where money and securities share a common ledger, monetary functions are executed by smart contracts, replacing the traditional batch file processes used in overnight real-time gross settlement (RTGS) systems. In practice, each policy tool is expressed as code: Project Pine demonstrated all three, using ERC-20 tokens for reserves and securities on a permissioned Ethereum-compatible chain. But how is tokenized monetary policy different from traditional monetary policy? Traditional policy operations rely on central bank systems such as Fedwire or the Bank of England's RTGS. These systems close overnight, settle in discrete batches and require multiple human sign-offs. A tokenized system settles atomically in seconds, keeps an immutable audit trail and lets policy adjustments propagate without waiting for dealers to book trades. The BIS paper on tokenisation notes that combining assets and settlement on a single ledger can shrink operational risk and latency. Did you know? A repo is a short-term secured loan in which one party sells securities and agrees to repurchase them later at a higher price. In contrast, a reverse repo is the same transaction viewed from the counterparty's perspective (buying the securities and later reselling them).
Finextra
15-05-2025
- Business
- Finextra
BIS and NY Fed test policy implications of future tokenised market
The Federal Reserve Bank of New York and the Bank for International Settlements (BIS) have published a joint research study that explored how central banks could continue to implement monetary policy operations in tokenised wholesale financial markets. 0 Dubbed Project Pine, the study found that central banks could deploy policy implementation tools using programmable smart contracts in a potential future state where commercial banks have widely adopted tokenisation for wholesale payments and securities settlement. The project generated the prototype of a generic monetary policy implementation tokenised toolkit for potential further research and development by central banks across jurisdictions and currencies. The BIS and the Fed say the prototype can fulfil a common set of central bank implementation requirements, including paying interest on reserves, open market operations, and collateral management. The toolkit was tested against ten hypothetical scenarios that applied historical data inputs on past market events, such as interest rate tightening and easing cycles, quantitative easing and tightening cycles, and periods of strained market liquidity or broader market disruptions. "The prototype successfully responded and instantaneously carried out the intended operation under the varying market conditions," states the BIS. "Project Pine's findings highlighted areas for further research and analysis related to interoperability and data standardisation."
Yahoo
14-05-2025
- Business
- Yahoo
Central bank project shows monetary policy still viable in 'tokenized' system
By Michael S. Derby and Marc Jones NEW YORK (Reuters) -Central banks should still be able to conduct monetary policy effectively and perhaps be even nimbler in a more decentralized financial system, according to the findings of a joint report released on Wednesday by the New York Federal Reserve and the Bank for International Settlements. The report said a prototype system designed to conduct monetary policy in a financial system reliant on new, more automated systems "successfully responded and instantaneously carried out the intended operation under the varying market conditions, consistent with the central bank's desired liquidity environment." The prototype created for the study showed there's even the possibility of central bank monetary policy working even better under a decentralized financial system. The project came out of work done by the New York Fed's Innovation Center and the Bank for International Settlements' Innovation Hub, as part of the Project Pine effort. "Central banks could use smart contracts to easily and quickly create new facilities or adjust existing ones to optimize the implementation of monetary policy in a tokenized environment," which means future operations could be "nimbler in uncertain conditions and potentially reduce frictions between the time of announcements and offerings," the report said. Tokenization refers to assets with digital tokens on a blockchain. The report noted that the research was conducted in conjunction with inputs from a number of central banks and its setup was generically oriented rather than tailored to the operations and goals of a particular central bank. The project was undertaken as part of preparatory efforts to make sure central banks will be ready for any future changes in financial markets. The prototype system covered by the report is designed to perform most of the key technical functions that monetary policy does now to achieve central bank policy goals. While there is no current threat to how central banks now intervene in markets to set interest rates and manage market liquidity, rising decentralizations and new technologies, some of which are in use already, could change that at some point. "If the private financial sector adopts tokenization on a broad scale in wholesale markets, central banks may need to participate in novel financial market infrastructures and interact with digital tokens to continue effectively implementing monetary policy," the report said. Decentralized financial systems could also create "emerging challenges" for money created by the central bank, the report said. In terms of central bank operational issues "the additional complexity of central bank operations has increased incentives to use technology to automate tasks and processes." At the same time, "central banks still face a challenge in integrating automated processes with those that require human judgment." Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNA
14-05-2025
- Business
- CNA
Central bank project shows monetary policy still viable in 'tokenized' system
NEW YORK :Central banks should still be able to conduct monetary policy effectively and perhaps be even nimbler in a more decentralized financial system, according to the findings of a joint report released on Wednesday by the New York Federal Reserve and the Bank for International Settlements. The report said a prototype system designed to conduct monetary policy in a financial system reliant on new, more automated systems "successfully responded and instantaneously carried out the intended operation under the varying market conditions, consistent with the central bank's desired liquidity environment." The prototype created for the study showed there's even the possibility of central bank monetary policy working even better under a decentralized financial system. The project came out of work done by the New York Fed's Innovation Center and the Bank for International Settlements' Innovation Hub, as part of the Project Pine effort. "Central banks could use smart contracts to easily and quickly create new facilities or adjust existing ones to optimize the implementation of monetary policy in a tokenized environment," which means future operations could be "nimbler in uncertain conditions and potentially reduce frictions between the time of announcements and offerings," the report said. Tokenization refers to assets with digital tokens on a blockchain. The report noted that the research was conducted in conjunction with inputs from a number of central banks and its setup was generically oriented rather than tailored to the operations and goals of a particular central bank. The project was undertaken as part of preparatory efforts to make sure central banks will be ready for any future changes in financial markets. The prototype system covered by the report is designed to perform most of the key technical functions that monetary policy does now to achieve central bank policy goals. While there is no current threat to how central banks now intervene in markets to set interest rates and manage market liquidity, rising decentralizations and new technologies, some of which are in use already, could change that at some point. "If the private financial sector adopts tokenization on a broad scale in wholesale markets, central banks may need to participate in novel financial market infrastructures and interact with digital tokens to continue effectively implementing monetary policy," the report said. Decentralized financial systems could also create "emerging challenges" for money created by the central bank, the report said. In terms of central bank operational issues "the additional complexity of central bank operations has increased incentives to use technology to automate tasks and processes." At the same time, "central banks still face a challenge in integrating automated processes with those that require human judgment."
