Cashing Out? - Biblical Thoughts on the Future of Money
(Cambridge Papers, December 2023)
We are living through tumultuous times in monetary affairs. After a decade of record low interest rates, inflation returned with a vengeance in 2022 and interest rates increased at a record pace. As a result, the second, third and fourth largest bank failures in US history coincided with the collapse of Switzerland’s second largest bank (Credit Suisse) in Spring 2023. Meanwhile, digital payment systems (including internet and mobile banking) are undergoing rapid transformation, cryptocurrencies and stablecoins are seeing a resurgence of interest and over 100 of the world’s central banks are pressing ahead to develop their own digital currencies (Central Bank Digital Currencies (CBDCs).
These innovations mean that we are fast approaching a crossroads at which the choice of path will determine the future of money for generations to come. The means for upholding personal privacy, or facilitating state surveillance and the potential means for persecution, will likely be forged in the process. It is therefore crucial that Christians understand and engage in the debate and bring biblically-informed wisdom to bear.
In the newly issued Cambridge Paper[1], I survey the biblical material that addresses money as a means of payment, explain the current bank-money system and its inherent problems, analyse cryptocurrencies and CBDCs, and draw conclusions for how Christians should interact with, and campaign about, the developments to come.
My primary concern is that the current bank-money system is debt-based and hence inherently inflationary. This undermines the role of money as providing a stable unit of account while facilitating the erosion of the real value of its debt that the government, who oversees the monetary system, itself issues. The biblical principle of decentralisation of political power argues against government having this power to influence the creation and quantity of money and in favour of monetary systems that are not intermediated through the debts of financial institutions. This in turn argues against the development of retail CBDCs and in favour of alternatives such as non-inflationary cryptocurrencies or commodity-backed stablecoins.
Paul Mills | January 2024
[1] https://www.cambridgepapers.org/cashing-out-biblical-thoughts-on-the-future-of-money/
The views and opinions expressed above are those of the author alone and do not necessarily reflect those of the Jubilee Centre or its trustees.
