Brett Scott: Beware a cashless society

Brett Scott: Beware a cashless society

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Hello and welcome to UnHerd, I'm Florence Read. In the UK, the use of cash fell by 50% in 2020. Our very own Prime Minister, Rishi Sunak, was one of the cheerleaders of an alternative, 'Britcoin', a national digital currency. And now the digital euro is being trialled across Europe. While the beginning of a

cashless society might make life easier in the short term, with contactless payments and carefree spending. But could tapping our cards get us more than we bargained for? Joining us to investigate this very question is Brett Scott. He's a former derivatives broker. He worked during the 2008 crash, so no wonder he has something to say about this. And the author

of a book called 'Cloud Money'. He is joining us live from Berlin. Hi, Brett. Hey, good to be here. When we talk about digital money, what do we mean by a cashless society? And is there anywhere in the world that a cashless society has been achieved already? Sure, I think you need to separate out a few different issues here. The traditional concept of a cashless society doesn't involve a central bank digital currency. So the

traditional concept of a cashless society is basically where the banking sector, the private banking sector, the likes of Barclays, HSBC, Santander, etc, control the monetary system. So for example, you mentioned the rise of, so called, cashless transactions in the UK. Those are basically bank transfers between commercial banks. This is not a central bank thing. It's a commercial bank thing. The debate recently has been somewhat altered by the fact that central banks have been starting to dabble in the idea that they too might enter the fray of digital currencies. But that remains a hypothetical

and currently non-existent situation other than a few pilot projects around the world. how has the pandemic factored into this drive towards the cashless? Well, the pandemic definitely accelerated a lot of the processes that were already in play. That's the best way to think about it. And bear in mind, actually there weren't any central authorities that came out and said, 'don't use cash'. Actually, it was often these companies like Tesco taking it upon themselves. And remember, in the early lockdown days in

the UK, you'd walk into a place like Tesco and they'd be blaring out of the loudspeakers to everybody, 'please use the card system'. Essentially, there wasn't any scientific evidence to prove this and in fact the scientific consensus on this was that cash didn't play a role and the first body to push that out was the Robert Koch Institute in Germany, which is a preeminent Health Institute in Germany who came out and said, there's no connection between cash and COVID. And this was later confirmed by a range of other research. But in the meantime, so many of these players went ahead and just push that story out. And of course, because people in general were backing away from the physical world temporarily, they sort of viewed everything that might have some physicality as being potentially dangerous. But you'll note now, if you go to many places- and

I'm using London as an example, quite a lot, because London's become very, very anti-cash. At least the companies have become... You go to many of these places, and they say, 'Oh, we don't take cash'. And you say, 'why?' and they say, 'well,

because of the pandemic'. Yet, you'll be in a in a pub with, like, 150 people breathing over the bartenders and they're sitting there telling me that the reason they don't take cash is because of the pandemic, which is, of course, ridiculous. So basically, what happened is that they used the pandemic to push this agenda forward and when the concern about the pandemic subsided, they stayed in that same position, keeping that anti-cash narrative. And this has been seen all over the world. For example, in the US, Visa entered into a deal with

the NFL, the National Football League that does the big football games, to have cashless Super Bowls. And they entered into that deal in 2019, prior to the pandemic, but the first of these cashless Super Bowls came out in 2020. And they use the pandemic, again, as a kind of cover. They said 'oh we're doing

this because of the pandemic', even though the deal was signed prior to the pandemic. And bear in mind what Visa and MasterCard do is they basically specialise in telling the banking sector who's trying to pay who. So, if you're in a coffee shop, you're trying to pay the owner of the coffee shop, visa basically tells your bank to transfer to the owner's bank and that's what they make money from. So of course, they hate the cash system and they've actively campaigned against cash for a very long time. There's tonnes and tonnes of evidence of this for card companies. But then the banking sector itself, for a

very long time, has been anti-cash and has been slowly trying to shut down the cash system because the banking sector runs the underlying account structures. And they also make fees from digital transactions and not only they make fees, they get data, which they use for all the other products. So the banking sector has a huge agenda. The Bank of America's CEO has actively come out and said, 'we want a cashless society'. It's very straightforward for them. The FinTech sector, as well, has been big in it because FinTech basically, is the automation of finance. All FinTech platforms are just trying to automate existing financial processes. And they can't work with cash because cash is an offline, non-automated form of money. So the FinTech companies hate cash

because they can't automate it. So they are all anti-cash. And bear in mind, often this takes the form of marketing attacks. If you're hanging out in places with these types of companies, they're constantly pushing out this anti-physical type of marketing, but then big tech companies, Amazon, all of them, they all hate cash. They can't automate it, they can't scale with it. I suppose on online shopping itself is a platform entirely based on the use of digital currency. We can't have online shopping without a cashless, or at least a cash low society.

You're totally right. This is one of the big things that if you zoom out to the broadest level, and you say, 'what's been happening in the global economy, and who are the biggest new players?', it's Big Tech. Big Tech relies upon people essentially moving off street-level commerce and moving on to online commerce and online commerce basically relies upon digital money. So ideologically, the sense that cash is on its way out has largely often been driven by this change in the structure of the economy where power is being constantly transferred to the Big Tech players who rely upon these transnational FinTech architectures to reach the scale that they do. In the background, there are government players who also have an interest in this. I think the libertarian community tends to overestimate the role of the states in this and underestimate the role of the Big Tech and big finance firms. But certainly, there definitely are state

agendas at play as well. There are many divisions of different governments around the world who are anti-cash, for example, tax divisions, who want to be able to monitor transactions; security officials, who want to be able to monitor transactions too and even some central banks who believe that you can use digital payments, or by getting rid of cash, you can do things like negative interest rates and stuff like that. But it's important to note that with the nation state players is that they have a lot more conflicting interests going on. They often have many conflicting mandates. If you're in a central bank,

part of your responsibility is you got to keep monetary stability in the country. And even if you might want to have greater oversight, to be able to watch all payments. You also don't want the monetary system to go down and actually having the cash system eroded is eroding the stability of the monetary system. So central bankers are actually quite apprehensive about cashless society.

I imagine a cashless society can't be great for local business either, if everyone is shopping on Amazon. We all know what happened to bookstores in the early 2000s when Amazon took over book selling online. What do we think society would look like if it was fully cashless? Is there a kind of vision of the future in which we no longer have any high street, we no longer have any local retail and we move entirely to an online system using digital currency only? Is that a future that you can imagine? Well, bear in mind, a lot of the big digital money players and even players like Amazon will try to claim that their platforms act in the interests of small businesses. In reality, of course, the structural change in the global economy... For example, if you compare the 1950s to now, in the 1950s, fine, you'd have big companies and they would be distributing their products but there would often be a lot more localised distribution, localised retailers, localised street-level commerce for people using cash, right? What's increasingly been happening is that far more business has been directed to these massive central players. But what does

massive central players try to claim is they try to say, 'well, having our gigantic globe spanning infrastructures helps the small player.' And you'll even see some of the bougie businesses in places like London and stuff with a youth aesthetics, they'll try to be like, 'well, you know, we only use Apple Pay and stuff and this is great, because it helps us cut our costs marginally, you know, because we don't have to handle cash anymore.' So there will be these hipster businesses that will make this claim. But bear in mind that what's

essentially happening in a cashless society is that every single localised interaction has to go through a central entity. So every single time you're in some local coffee shop, every single time you're even trying to donate to a busker, it's going via the central system, earning fees for the central players. And unfortunately, what's going on in places like the UK right now, is certain parts of the small business community are essentially actually aligning with Big Tech and big finance, right? You'll go to certain pubs, and they'll say, 'oh, actually, it's slightly easier for us to just rely upon...'

Well, we're back to the point of convenience again, aren't we, that if they give enough carrots to these companies, they will align with them rather than taking the stick of having to deal with the fiddliness of cash? I mean, of course, they're going to align with the thing that's easier for them. But what's the what's the effect of that? Is it that we become a place where you have to you have to align with digital big players, or you are lost? Yeah, unfortunately, how the debate goes right now is that you'll say somebody will notice, for example, that a small shopkeeper maybe can save like a sort of marginal amount of money by converting to this digital system. And then they'll say, 'well, because some small business person is able to do this, this is obviously good for society.' All right, but the interests of a business doesn't necessarily correspond to the interests of the overall society. What's basically happening in places, where all these businesses have started doing that, is that they essentially coerced everybody who's buying into using these platforms. You know, in the UK, and many other European countries, people are not necessarily always, if you walk into a shop, and you're told you're no longer allowed to use cash, most people just go along with it. They just sort of say, 'oh, well, I guess, okay, fine.'

And they just sort of get trained that this is not normal. I mean, I'm the kind of person who'd cause a scene if that happens, but I'm not necessarily the average person because I'm more politicised about this issue. But many people are just being pushed into it. And what ends up happening essentially, is you your entire economy becomes dependent upon Visa and MasterCard and Apple Pay, right? Tell me more about the motivations behind a push towards this cashless system. You're saying that this is not just a turn of history, this is something that has been advocated for by Big Tech. So why are they doing it?

Yes. And also, look, don't get me wrong. I'm not trying to push some hardline conspiracy narrative. What I'm talking about is processes that happen in corporate capitalism quite naturally, where these large oligopoly players will try to slowly entrap you by fighting, right? That's what they do. Right? You don't really need a sort of conspiracy story to explain how this occurs. These big players all have the same interests. They want to automate. They want to push people into ever more of these transactions. But the best way

to think about how this works ideologically in society is many people have been trained to believe that cash is something like the horse cart of payments and Digital's like the car. With that sort of mentality, they imagine that what's happening is that the money is being upgraded when in reality, what's a far more accurate metaphor would be to say cash is more like the bicycle of payments. And digital is more like the Uber of payments. So you own your own bicycle and you know you can take it out for a ride, but with an Uber, it's someone else's car? Yeah. And actually, in the short term, you may think to yourself,

'oh, I like using Uber, it's nice and convenient. You know, it's a Friday night, and I'm gonna get home.' Fine, I understand, there's a psychological process going on but imagine now the scenario where the only way you were able to travel was with Uber. Totally different story. Now, your entire transport system is under the control of a oligopoly player. You can't move unless they decide you're allowed to move. And so there'll be massive resilience problems, exclusion problems, all sorts of problems that emerge from that. And it's

a similar thing with his cash debate, the best way to think about cash is like the public bicycle of payments. Fine, you don't have to use it for everything but in the situation where the private Uber of payments takes over, your society has very, very big problems. And this is basically a principle of keeping a balance of power in the monetary system.

And remember, going back to what I said earlier about the fact that in the monetary system, we have these different layers of money and different issuers, and they issue it in different forms. What the original balance of power was; physical layer one money versus digital layer two money. That was like how people... What's happened is basically digital layer two money's becoming way too powerful. And that balance of power is now actually causing the CBDC debates to emerge, because now the states are saying, 'oh, damn, our whole monetary system could be undermined by the fact that the private sector banking sector is taking over the whole payment system, maybe we got to now try to compete by issuing this digital form.'

I suppose also, what pushes people to feel conspiratorial about it and goes one step further in your analogy of the Ubers and the bicycles would be in that world if some roads were closed down to bicycles. So the government said, No, you're not allowed to ride your bicycle down here. It's for Ubers only, and then slowly and slowly, the roads became more and more Uber-only, and you were no longer allowed to take your bicycle out. I mean, that's basically what has happened. In many shops. I know in Starbucks, for example, you walk in, and there is no option to pay in cash anymore. So what happens to people who are still using their bicycle, using their cash in this new system, in a cashless society, what happens to them? Well, I mean, obviously, you're being essentially... There's an

enclosure going on. If we're using the Uber metaphor, it will be a private enclosure of the ability to travel and maybe there'll be a state actor that's benefiting from that or not? And that's the question you can ask yourself. And then what happens is that a lot of people are excluded from that situation. So there'll be the exclusion, people who can't use that. We'll get pushed out and what that perversely creates is a subsequent inclusion story. So, you'll have a bunch of people who go out and say, 'oh, it's terrible that some people not able to use Uber, we should have Uber inclusion programmes, where we get them on boarded onto Uber to help them access the transport.' This is actually very similar right now, when you

hear in debates around cashless society, there's a bunch of well-meaning people sometimes say, 'oh, isn't it it's a problem that some people can't access the digital money system. Therefore, we want to find financial inclusion, ways of getting them on boarded into Barclays and PayPal and Apple Pay essentially. So rather than having these debates, but rather than saying, we need to protect the alternative system, people often say, 'we need to subsidise people being on-boarded into the enclosure.' So you'll have people who say, Well, you know, my grandparents still use cash, and we got to give them more time and help them with some kind of app to help them get on board. What the story should actually be is, we need to

maintain a balance of power in the monetary system. And actually, we should all be maintaining a balance of power, much like we might all want to use a bicycle and Uber, we all got to be participating in this in this process of changing that story around what cash means. So I'd like to go back to something you said earlier, because it's intriguing, which is about the data that these banks can basically take from every single payment that we make when we use digital currency. Can you tell me a bit more about what that data actually is? What you're paying for, who you're paying, when, where, how, and in what context and there's metadata around that as well.

And different players have access to that data. This is quite a tricky issue, because there's lots of different jurisdictions. There's lots of different rules and stuff. But the basic participants in this process are going to be the banking sector, who's getting data, the card companies are getting data. Networks like Swift are getting data from different types of transactions and increasingly, FinTech players and Big Tech players too. So there's a lot of this,

and there's data sharing that goes on between them. So even when they're not directly collecting the data themselves, they have these data-sharing systems where they're sharing the data between themselves. And the main bodies of ... The types of things to be concerned about with the use of data. People are often imagining the Big Brother-type concerns where there's an entity that's watching you and kind of disciplining you but there's also other- In my book Cloud Money, I talk about three different kind of players. There's the big brothers, there's also the big bouncer and the big butler. Big bouncers are players who use your data to

decide whether you can get access to things or not. Imagine a bouncer at a door who says you get to be in and you don't get to be in. But there's lots of these players who are using data to decide if you get access to services or not. And there's also the big butler players who basically players who use your data to manipulate you into actions. Imagine a kind of like

creepy butler, who stands behind you and offers you things. So a lot of the Big Tech players do this kind of creepy data stuff, where they're sort of curate your world. This is targeted advertising and that sort of thing. Many other things. Yeah, even that websites that you're

looking at, you think it's a public website but actually it's curated for you, depending on what your what your previous browsing history is. But you imagine that it's a public website, but it's a private bubble, essentially. And that's what this data is. It can be useful. And bear in mind that payments data is a very, very sensitive form of data, because it shows you exactly how you act in the world. I can blab on about my aspirations and what I want people to think about me, but if you want to see what I actually do, just look at my payments data, right? And that's why it's a very, very valuable form of data.

I suppose it's also involved in your location. And if you were someone of interest, whether that's of international interest, or whatever that is, monetary interest to a company, then they can also effectively stalk you, can't they? I mean, they can literally follow you around the world; see where you are at any given time and what you're doing. It's an insight that we would not give up easily, I don't think, if we were asked to give it up in a questionnaire in the small print of a form. We wouldn't sign our name under that but we all do it every day when we tap our cards. Is that something that we should

be concerned about? Is it something that, actually, we need to start acting against? Yeah, it is something to be very, very concerned about. A very simple and good example of this has been in the the Hong Kong protests that happened a little while back, where a lot of young people in Hong Kong who were getting involved in the protests, who ordinarily have been drawn into digital payments, apps and stuff, suddenly there were these stories, which showed that they were queuing up at underground stations to buy physical tickets with cash, because they knew that if they were tapping their cards, and so on, you could see where they tapped in and where they tapped out. And if you're an authority watching that, you can say, 'oh, they got off at the protest site, didn't they?' You can suddenly see all this types of stuff. And people knew this. They were like, we know

that our payments can be watched. So in any authoritarian country, people all know about this already. But in terms of actual movements, yeah. I mean, people like me, and others are trying to work on building those types of movements.

Unfortunately, I'm going to say that, unfortunately, some of the early movers on this... There are a lot of conspiracy theorists, who have taken the lead in describing what's happening in this situation. To me, that's unfortunate, because it often actually discredits this movement in the eyes of a lot of other people and there's very, very serious reasons to be concerned about a cashless society but it's not because a shadowy cabal of ten guys are sitting in a room wanting to control your life. No it's because there's a corporate oligopolies, like spanning the globe who have particular interest. So yeah, there is definitely grassroots movements forming but I think there still needs to be a lot of education about how this process actually works to get away from the kind of more sort of conspiracy stories about it.

There is a bit of confirmation bias there as well isn't there? If you feel conspiratorial around something like digital currency or central banking, you might look at something like when Pay Pal decided to close down people's accounts for misinformation, and think, 'well, that's all part of our grand plan. And I want to uncover it.' So I can see where those people are coming from, and I'm sure you can too? I understand? The global economy is a very hard thing to understand and the corporate sector too and it is sometimes quite enticing to believe that there are these small groups of people who are in control of it, but in reality... Actually, the world would be much easier if these conspiracies actually existed because at least you know how to solve the problem. Often the reality is, we're dealing with often, a lack of coordination that causes this. It's all these players who are fighting each other, who basically, in the process of competing will often end up doing this. All the Big Tech players, they're not taking their directions from some government official. They're taking directions from their

shareholders. Well, let's talk a little bit about somewhere where there are government officials giving orders to banking systems, and that's in China, where they do have a functioning social credit system and they can use digital currency to crack down on, as you were saying, protesters, but also just in everyday life stop people accessing things that they want to buy, or experiences they want to have simply because their social credit score is too low. So tell me about that. Is that something that we should be worried about? Yeah, and of course, these are all things to be to be worried about. The Chinese government has a different structure than the average Western government. The Chinese government has a lot closer relationship or oversight or control over the corporate sector there. So a lot of the corporates in China are much

more tightly tied into the state, including the banking sector. What's happening is the Chinese Central Bank can actually watch what's going on in those systems. So there's a lot of oversight and of course, this is then playing into the social credit system, which is a system that tries to aggregate different types of data about people to create these sort of score systems. And the basic concern about that style of

system is that it gets very sort of Black Mirror, when you get these black scores that then can affect your access to things. So you can get rewards or punishments, and get upgraded and downgraded in society, depending on your score. And of course, that's something to be very concerned about. And try

and stop. Well, this is something they've been talking about at COP 27. They've been speaking about an idea of a Carbon Tracker, which would effectively give points for carbon neutral purchases, and then effectively deduct points for carbon-emitting purchases. Is that not coming close to that kind of Chinese social credit system? Well, you'd have to actually see when it's when that's that's implemented, right? I mean, if it actually is implemented, then we could say that right. They're saying October 2023, perhaps for a launch? Well, let's see what the punishments are. The thing about places like the UK is, I mean, imagine trying to implement that in the UK. You'd have a lot more social protests than in a place

like China. So yeah, bear in mind, all these types of payments, chaperoning systems or of watching payments and scoring systems can be applied to many, many different things, depending on the political context. What's happening right now in the big mainstream institutions is big mainstream institutions, let's say the, you know, the kind of like the big IMF and World Economic Forum type players is they're stuck between two big narratives going on. One of them is digital transition and the

sort of digital transitional or digital transformation story has been going on for decades now. It's essentially a corporate narrative, which says everything must be automated. That's what the digital transition is. And every politician around the world will constantly be talking about how we have to go to digital, we have to automate everything. And then there's a second narrative that's emerging, which is the green transition, which actually comes from a different place. It's not

really a corporate narrative at all. No corporates have been going out saying we should like greener infrastructure, because of course they actually like cheap fossil fuel. So now you'll find these international institutions are sort of caught between these two narratives, and they're trying to fuse them together. They're trying to say, 'okay, well, we can do the green transition while following the kind of corporate digital thing at the same time'. And this is giving rise to a lot of concerns, especially in the sort of more Right-wing parts of the political spectrum, to say the World Economic Forum is going to control you. It's going to force you to buy green products and

track you with the digital ID, which may or may not be true but the thing to bear in mind is that, actually, this movement is being driven by corporates, largely. Crypto is suggested by lots of libertarians as the antidote to the problems of a cashless society that you've outlined. Yeah, you're right. That's, amongst many people, in the early '90s, there was a, a movement, a loose movement called the cypherpunks, who are basically looking forward into the future saying, 'hey, if we end up in a cashless society, this is going to be a big problem. We're going to have

huge problems of corporate and state surveillance and centralization of power.And in that hypothetical scenario, we should have a form of digital cash that can compete with that or form a kind of counter power.' So this is true that this is what is a part of the founding of... A lot of the technologies that led up to things like Bitcoin came out of that intuition. And then in 2008, Bitcoin emerged, I've been involved in the Bitcoin movement since about 2011 or so but I increasingly get referred to as a as a crypto-critic or crypto-sceptic, largely because I don't toe the line of the sort of standard ideology of the Bitcoin community.

Given what's happened in the last few weeks, you might suddenly have come into the majority. Yeah, maybe but bear in mind, the Bitcoin community always likes to make sure that it's super countercultural and that everyone's against it but actually within the Bitcoin community there's a lot of groupthink. It's got very heavy herd mentality within it. And there's a lot of conventional

ways of thinking about it. And I have a different way of thinking about Bitcoin, so often get classed as being like anti-Bitcoin. But in reality, what I'm often interested in is describing how it actually works and how Bitcoin actually works, is that it doesn't actually compete with the monetary system. It actually rides on top of the monetary system. And I write a lot about this- Do you mean there that it's a kind of luxury currency that we have the system as we know it and then on top of that, we have Bitcoin and crypto and that becomes a plaything of people who also engage successfully in that in that main system? Is that is that kind of what you're saying? Bitcoin essentially operates as a kind of a limited edition collectible. Let's put it like that. All right. Imagine you walk into like an antique shop and you see these ornate medallions. They sort of look like money, but actually, they're priced in money and this has a price tag that says, this costs, you know, £1500. That is a antique limited edition

collectible that's actually priced in money. And actually, this is one of the best ways to think about Bitcoin. They're like, limited edition digital collectibles that have the appearance of money but that are actually priced in money. And what's interesting about that is because it's digital, it's highly swappable. A physical collectible is actually quite hard to send to somebody, right? Whereas a digital one is very easy to send. This gives it a much more money-like feeling because I can transmit it from here in Berlin to you across there and you'll see it pop up. But in reality, what we're often

using is its monetary price to decide upon how much gets sent. So for example, if you have something- this is a process called counter trade, which is where you use the monetary prices of non-monetary things to decide upon an exchange ratio between them. So if you had something that costs like... If you had a jacket that cost a hundred pounds and I had two objects that cost fifty pounds, I could say I'll give you these two objects for that jacket. It might look to you like I'm using the two objects to pay you but what's really happening is I'm implicitly using the monetary price of those two to swap it with you, right? Sure. Although, in this in this story that we're charting of the weaponization or potential weaponiaation of digital currency, the advocates of Bitcoin or crypto will say that, 'well, that puts you in a position where you're no longer at the whim of the central bank.' So for example, in Canada, when there was the truckers movement, they were shutting down truckers' bank accounts, but they couldn't, for example, shut down the Bitcoin accounts, on platforms like Kraken, which is the platform of Jesse Powell, who we interviewed a few months ago. And he refused to shut down the accounts,

despite being asked to buy the government. So I suppose that's the question there is does it actually make you immune to this sort of weaponization of the digital currencies? So this is this is where the nuance is, you can use dollar-priced digital collectibles as a way to escape having to use the banking sector. The thing that I will reject is the idea that they separate from the existing monetary system. They ride on top of it. But in doing that, you can actually use them for things like avoiding having to use a bank payment system, if you're prepared to accept the fact that they massively fluctuate in price all the time, which is a big problem if you're a person who's got low amounts of money. If a Bitcoin advocate comes up to a person who's like,

only has a few thousand pounds of savings and says, 'hey, you should be using this.' I did wonder how the truckers of Canada were going to be racking up their Bitcoins. If they're going to use it, they'll temporarily buy it, use it to exchange and then they'll sell it back for for the ordinary money. This is how it actually works. Very few people are prepared to hold all their wealth in the form of a highly fluctuating digital asset, because bear in mind can fluctuate by 40% at a time. I mean, your nervous system has to be very, like heavily used, that takes a lot of...

Have you seen some of these Bitcoin guys? Yeah, well, you have to have a certain mentality for that but imagine you're a small business owner and you've been told, okay, put your whole inventory into this, it's gonna be terrible. Maybe it's lucky if it goes up but if it goes down, suddenly half your net worth has disappeared. So this is not what average people want because, again, you're using a fluctuating digital collectible for exchange, which you can do.

and that is a useful thing sometimes but it's not a meaningful alternative for many, many people other than in sort of marginal cases. But yeah, it's definitely creating new opportunities. But at what the probably the most profound and controversial thing in the crypto world is actually the stable coins, which are going back to the characterization of money I was giving earlier, where you have these different layers; where there's first layer money, second layer money, third layer money. The second layer money being a bit like casino chips, and third layer money could be like the casino chip on top of the casino chip. Actually, the stable coins

systems are very much like a kind of crypto version of third layer money or a crypto version of PayPal. And those actually are quite destabilising, potentially for the banking sector, probably more so than something like Bitcoin is. What is your pitch for how we all engage in this kind of fight against the cashless society? If that's what you're kind of activist for, how do you suggest the average person who goes out and is now used to- very used to- tapping their card and that completely seamless process, how do you think that they can reduce the amount of cashless interactions they have? And how can they convert back into a life with cash? Sure, well, the first thing is to stop calling them cashless, because what they actually are is like Big Tech, big finance transactions, right? I think, that'd be a big step forward in society if we actually named them correctly because right now the dominant were speaking about it as to talk about this idea of a cashless society rather than the bank, tech-dominated society. But you know, once that the other important part of the reframing is to use this idea, and popularised this idea that cash is like the bicycle of payments. Bear in mind, it's

actually very instructive to look at the history of cycling movements. Back in the 1950s and the '60s, '70s, this wasn't a real big, powerful movement. It was took a big cultural, political push by people to say, 'actually, we want bike lanes, we want to have a rights as cyclists, but we want to have the the rights to be able to ride through London without getting, you know, run over by a taxi'. So I think it'll take a

similar cultural push to push the cash movement to say, 'okay, this is not the horsecar payments, this is the bicycle payments, and we demand rights to maintain this as an option.' And I think that's what's super important because right now, what's happening is, people feel a sense of shame when they pull out cash in a particular type of shop and in a place like London, especially if it's an upper-middle class, middle class shop, where there's these class dynamics at play, right? They'll feel like they're a bit out of sync, like there's something wrong with them, because everyone else has pulled out their Monzo cards or they've got a little app, right? And you need to create this feeling in society that is totally acceptable and good to actually be able to pull out cash. Right. And that takes a cultural political movement. So that's what we've got to build, essentially. Brett Scott, thank you very much.

Thanks for having me. That was Brett Scott, former broker turned critic of digital currencies. Should we all be putting our hands in our pockets and paying for our next pint with cash? Well, that's what he thinks. I'd be interested to hear what you think too. Thanks for tuning in. This was UnHerd.

2023-01-05 00:27

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