(VOVWORLD) - Countries of the BRICS economic bloc are currently working on the launch of a financial system that will be independent of the dominance of third parties, according to Russian Ambassador to China Igor Morgulov.
They mean a supranational currency aimed at transforming international trade settlement that sounds very similar to the idea of Bancor that Keynes proposed. The key idea is to establish a common unit of account and clearing system for international transactions. This would prevent the dominance of national currencies in international trade, promoting a more equitable financial system that’s not dominated by the currency of any single country.
This concept would tackle persistent trade imbalances by incentivizing countries to maintain balanced trade, as excessive surpluses or deficits would incur penalties. The idea also has potential to enhance financial stability by countering speculative capital flows that often destabilized exchange rates and caused financial crises.
That’s sort of what Bancor is, in programming terms you can think of it as a common protocol that you can adapt your currency to, and then it can be used with anybody who’s also implementing this protocol.
By financial system they still mean a swift/Cips/sfms/spfs alternative?
They mean a supranational currency aimed at transforming international trade settlement that sounds very similar to the idea of Bancor that Keynes proposed. The key idea is to establish a common unit of account and clearing system for international transactions. This would prevent the dominance of national currencies in international trade, promoting a more equitable financial system that’s not dominated by the currency of any single country.
This concept would tackle persistent trade imbalances by incentivizing countries to maintain balanced trade, as excessive surpluses or deficits would incur penalties. The idea also has potential to enhance financial stability by countering speculative capital flows that often destabilized exchange rates and caused financial crises.
They should start thinking of a plug and play system similar to activity pub for all that finance old fashioned system
That’s sort of what Bancor is, in programming terms you can think of it as a common protocol that you can adapt your currency to, and then it can be used with anybody who’s also implementing this protocol.
I wonder what kind of discussions take place when they implement these kind protocols (thinking of swift):
I think the interesting part with the Bancor approach is that it would avoid a lot of these problems since it’s strictly a settlement currency.