Memes Mean Money

Today, we're simultaneously launching a new podcast under the same name as this newsletter: CoinDesk's Money Reimagined.

This is a useful lens to apply to the many new ideas for money bubbling up in the crypto world.

Whether it's bitcoin's bid to become a digital gold-like currency or the fight between Uniswap and SushiSwap to dominate liquidity in DeFi's lending markets, the semiotic process for creating memes and stories is vital to the establishment of a new system.

In the COVID-19 era, banks have learned that, with the help of new low-latency connectivity packages, their traders can work pretty well from home, offering the prospect that the firms can save millions in rents if they pare back their footprint in the city.

An exodus from New York by bankers, traders and brokers would mark an end to an era.

There are plenty of reasons for banks to maintain a legal residence in New York.

Most important, the Federal Reserve Bank of New York has a unique role within the Fed's monetary system, as it conducts the open-market operations by which the central bank implements monetary policy.

To act as a counterparty with FRBNY in those trades and gain access to that vital flow of monetary liquidity, banks need, at the very least, a capital markets subsidiary domiciled in New York.

It's not hard to imagine that a physical downgrading of banks' physical presence in New York could, over time, degrade the city's dominance.

Will the rest of the U.S. continue to grant NYC its gatekeeping role? And as central banks, potentially armed with digital currencies, move to expand the range of counter parties they deal with to include non-banks such as large companies and municipalities, New York's centrality in the process could be further diminished.