In the United States 69% of adults drink at least two cups of coffee a day. Humanity’s experience with coffee doesn’t begin and end with our morning thermos though – where there is culture, coffee culture isn’t far behind.
Heavily influencing European cultures, the Dutch Parisians, and Venetians in particular, the first coffeehouses as we understand them today began cropping up in the Netherlands. Offering more than just a place to sit and enjoy a hot cup of coffee, the coffeehouse offered a neutral location for socializing, discussion, innovation, and even dissent. Sociologist Ray Oldenburg describes the concept of the “third place” as a meeting place other than the home or workplace that remains accessible to all, regardless of status.
Third place locations often include other familiar settings like bars and public parks, even barber shops take on this role in some communities. What we get from the third place is a setting that’s focused on building and maintaining community, conversations, and important interactions. In 1792, the Tontine Coffee House in New York City served as the birthplace for the New York Stock Exchange; decades later and hundreds of miles away, the all-American cocktail the Sazerac was named for its coffee home, the Sazerac Coffee House in New Orleans.
In pop culture, we see the reflection on our need for a third place. Up until the early/mid-1990s, the third place of media choice was a bar; sitcom favorites like Cheers took place almost entirely within a bar. But as times changes, and coffee obsession began to take on a local mood, our favorite characters started spending their time at coffee shops instead.
Seinfeld and even Cheers spinoff series Frasier all had essential plot setting in their community coffeehouse. “Central Perk,” the coffee and favorite hangout spot from the massively popular TV sitcom Friends became so memorable to fans that Warner Bros had trademarked the rights to the name, logo, and facade signage and maintains these rights even 15 years after Friends had finished its run on TV. In 2014, WB hosted a temporary pop-up recreation of the Central Perk café, catering coffee to fans.
Looking back on our history with coffee can not only help us predict the trends of the future, but also offers us interesting and even relatable insights into the past. When we see coffee’s place in the movement of the world from global trade, political unrest, social defiance, and community building. Coffee is full of contradictions – and yet we still enjoy it every morning. Take a look at this infographic for more on a deeper look into coffee culture and how we can use it to look towards the future, espresso in hand.
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The idea of “,” a cryptocurrency sponsored by the U.S. government and managed by the Federal Reserve, has been around for quite some time. “Imagine that the Fed, as the core developer, makes available an open-source bitcoin-like protocol (suitably modified) called Fedcoin,” a Federal Reserve VP already in 2015. The idea gained traction also in Europe in connection with the financial crisis in Greece, and was notably discussed in a “” context by former Greek Minister of Finance .
Earlier this year, Nobel Prize–winning economist Joseph Stiglitz he believes “very strongly” that the U.S. could and should move to a digital currency and get rid of physical currency. While Stiglitz is persuaded that “the main use of bitcoin has been to circumvent tax authorities and regulation,” he appeared to be in favor of digital currency technology for government.
“The technology underlying bitcoin could fundamentally change the way we think of money,” said , a finance professor at Duke University’s Fuqua School of Business, in the . “It is only a matter of time before paper money is phased out.”
Phasing out physical cash — the reserve of drug dealers and black marketers — would be one of the main advantages of a national cryptocurrency, according to Harvey, since it would make it far more difficult for criminals to hide and launder money if all transactions could be recorded on the government’s blockchain.
The potential for privacy isn’t considered a desirable feature for state-owned cryptocurrencies. On the contrary, as Harvey argues, the introduction of digital currencies would be partly motivated by the desire to eliminate the anonymity of cash. On the other hand, even in a future Fedcoin-like, all-electronic economy, it’s easy to predict that there would be a strong black economy on the side, powered by privacy-oriented cryptocurrencies, including bitcoin, ether, Monero and other emerging alternatives able to offer .
“Despite the negative press about bitcoin being used for illegal transactions, bitcoin is not anonymous, and criminals who use it often do not understand that their transactions are being recorded,” notes Harvey. In fact, while a bitcoin address isn’t explicitly associated with its owner, blockchain network analysis can often de-anonymize bitcoin users. To support law enforcement, companies like and offer sophisticated blockchain network analysis tools and services to trace bitcoin transactions back to their participants and de-anonymize users.
In , Harvey defined Fedcoin as “a digital USD currency where the complete history of all transactions is visible to the Fed via a Fed blockchain.” That blockchain technology, initially thought of as a libertarian means to escape government control, could become a killer app for governments to have complete control over the citizens, and enforce compliance and tax collection, seems surreal to say the least.
Indeed, as Saifedean Ammous, an economics professor at the Lebanese American University, toldbitcoin Magazine, “The importance of bitcoin is that it makes monetary policy and payment settlement according to predetermined software, free of third-party control. This defeats the point of having a central bank, and is anathema to central banks’ mission, to control monetary policy and supervise money flows.”
In the presentation, Harvey cited economist ’s 2016 book “The Curse of Cash,” which proposes to gradually phase out cash, eventually leaving only small notes and coins in circulation, and move to electronic money, perhaps “a government-run version of the virtual currency bitcoin.”
While Rogoff is not persuaded that the “potentially disruptive” technology of today’s cryptocurrencies is sufficiently mature, he thinks a next-generation “bitcoin 3.0” could be a precursor to a government-controlled digital currency. “If the private sector comes up with a much better way of doing things, the government will eventually adapt and regulate as necessary to eventually win out,” says Rogoff.
Ammous disagrees with this sort of argument. “The only thing central banks can do with bitcoin is accumulate it as a monetary reserve asset. At some point, central banks around the world will start asking themselves if they might be better off holding bitcoin, with its apolitical monetary policy, than other countries’ national currencies.”
Central banks have as much to learn from bitcoin’s operation as horses have to learn from car engines. It’s a technology meant to displace central control of money.
“The Fedcoin idea was by David Andolfatto, Vice President, Federal Reserve Bank of St. Louis, at the that I organized at the Bundesbank in Frankfurt, 2015,” Paolo Tasca, of the, told bitcoin Magazine.
“The idea of dispensing with cash in favor of alternative, more efficient means of payments is not new. Pre-1900 utopian thinkers devoted a lot of effort to finding a way to allow people to get rid of what Robert Owen called the ‘insane money-mystery.’ In more recent years, economists have also begun to study the implications of living in cashless societies, especially referring to the role of central banks and to the conduct of monetary policy.”
Other governments and central banks are considering their own versions of Fedcoin. Sweden’s central bank, the Riksbank, whether the country should introduce a purely digital form of government-backed money, perhaps using distributed ledger technology (DLT). The proposed e-krona would be a digital complement to cash guaranteed by the state, and work as a means of payment, unit of account and store of value. It’s worth noting that usage of cash in Sweden is declining, and that the country could go entirely cashless in five years.
The Riksbank isn’t the only central bank to consider issuing its own digital currency. The central banks of , , and others are considering similar moves. A recent issued by the Bank of Canada, which considers a possible bitcoin standard similar to the gold standard, is especially interesting. A published by the Bank of Finland, which describes bitcoin as a revolutionary, marvelous economic system, could indicate that the bank is considering with interest the possibility to someday launch its own digital currency. Even China’s central bank is a digital currency.
“Other central banks (Bank of England, Bank of Canada and European Central Bank, among others) are studying the idea of a Central Bank Digital Currency (CBDC) as a non-ordinary monetary tool that could improve the central banks’ ability to stabilize inflation and the business cycle, and as a new payment channel that could permit tracing the network of payments and record the payment history of each individual,” added Tasca.
Another reason for governments to like the idea of a national cryptocurrency, according to both Harvey and Rogoff, is the possibility to strengthen the power of monetary policy to help manage the economy, for example by making it easier to impose negative interest rates.
Harvey notes that, were the Federal Reserve to adopt its own cryptocurrency someday, it will become a major (and far less volatile) competitor to bitcoin and other digital currencies. “In fact, it’s not clear whether [F]edcoin would want that competition, and the Fed is in a position to impose a regulatory environment that tilts the playing field,” warns Harvey.
