Sunday, November 22, 2020

Any Swift bank today

 Can legally run a non profit contract for digital dollars, using common proof of stake code. They publish their public key for verification, and emit valid Swift swaps into and out of digital dollars. Within any contract, a counterparty can verify the dollars allocated, specifically and generally.  The Swift bank maintains the short chain, but all Swift banks adopt the same code, say they own load it from Redneck trading systems.

It becomes like a split in the Swift ledger, much of it appearing off ledger, swirling around in Swift internal accounts. But there is no crime, no loss. They are simply running an automated account management scripts for their clients. Like flash loans, in a way.  The banks make money in the oracle business, they can validate a payment within a contract, and charge a fee, like banks always do.

I think this falls into payment service provider, a simple code, runs on any smart phone, short chain dollar payments at the local bank. The crime is the cost, the code is free at Redneck systems. So banks can do it easily and get PSP business. It is easy to police as long as the banks make frequent back ups. But the short chain clears fast, days, weeks, is fast. And has a count limit, the bank has a lower bound on counterfeit on the short chain.

The short chains can be decomposed, in various ways according to time and count limits. Longer term deliveries can use short chain for partial payment on delivery. This does not need a Swift ledger until build and deliver is done, so hold these sequences with partial short chain dollars, good everywhere.

How does the central bank collect Fed taxes? They make the Swift banks raise fees, and begin to sanction banks.  Bad news all around, another failure and loss of market share.  Central banking is stuck until we get a better Fed contract. The Swift rates are low, and lower and retail sales taxes not working well anywhere. This will all be concluding with a meeting of the elders.

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