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Nation states such as China India US and Senegal have embarked on an agenda to either propose or start creating cryptocurrency infrastructure to replace existing "note" based infrastructure. Singapore, a trailblazing technical powerhouse is at the leading edge of implementing such technology through their well publicized Project Udin experiment. Such an initiative has several advantages:

The robustness of a permissioned or permission less blockchain ecosystem is extremely well known and well understood. It is secure and extremely robust to all kinds of attacks on its cryptographic protocol.
Dynamic monetary policies will enable governments and national financial institutions to accurately create, tweak and develop new forms of monetary policies that did not exist earlier.
The cost of printing, regulating and preventing fake -or duplicate physical fiat currencies is reduced to 0 - since digital cryptocurrencies can never be duplicated and/or faked. The ledger validates with 100% surety.
Problems such as double spending, money laundering, etc. are easily stoppable and recognizable.
Governments, now need not necessarily introduce different fiat nominations and digital nominations and over a period of time, can wield significant control over the country's money supply, flow and accounts which today - due to the percolation of physical fiat currency notes is very difficult to ascertain.
Nevertheless, e-commerce and regular commerce will significantly become easy.

There are some disadvantages too for the national cryptocurrency system.

the volume of cryptocurrencies needed will significantly be large - and as a result will need decades of developing a robust infrastructure to support both high cost and high speed of transactions.
If national monetary systems become completely digitized over time then existing business models including those of currency notes, banking infrastructure i.e., money transfer systems, ATM networks, connection infrastructure among banks, that has existed over the past 100-150 years will have to be replaced in its entirety. Imagine if one just needs an internet connection and a digital wallet to access one's account - what would be the need for a bank?
Such national cryptocurrency systems will need to interoperate among different nation states since each nation state will want to build its own infrastructure.
Lastly, monetary freedom of a nations citizens and people can completely disappear when central control of digital currencies happen.

Posted from my blog with SteemPress : https://www.cryptonewtech.com/2019/10/05/national-cryptocurrencies-boon-and-bane/