The villain of the free world.
The idea of replacing fiat – physical money such as paper and coins – with digital money has been talked about in recent months. The UK and Germany lead the conversation in the democratic world and they have a solution: CBDCs. It’s set to be one of the main topics discussed amongst the G7 nations later in June at the G7 Summit hosted by Germany.
CBDCs and their benefits
So what are CBDCs? The acronym stands for “Central Banking Digital Currency” aka the digital form of that country’s fiat currency. Basically the country’s currency would not be changed. Instead, it would all be transformed and used digitally instead. The transition from physical to digital and governance of the new system would be operated by either the monetary authority of that country or the primary central bank.
The primary aim of CBDCs is to reduce complexity of banking procedures, lower-cost international border transactions and third-party infrastructure costs, and provide everyday users with ease of access to their funds. A bank or government would grant the user an account and from there all funds would be operated, allowing the use of programmability from the overseers within the government and banks. This could bring a huge change to society not only in the financial system, but on a day to day basis for people. Tom Mutton (Director at the bank of England) stated during a conference that,
“You could Introduce programmability – what happens if one of the participants in a transaction puts on a restriction? There could be some socially beneficial outcomes from that, preventing activity which is seen to be socially harmful in some way.”
A colleague of the former, Sandra Ro (CEO at Global Blockchain Business Council), compared programmed digital currency to the US benefits system. She stated in a positive light:
“It could have a similar goal of restricting the recipient to buying only essentials such as food with the money.”
Why are CBDCs dangerous?
In contrast to cryptocurrency, digital currency is controlled centrally through the banks. Instead of having a bank account with JPMorgan Chase or the Commonwealth Bank, your personal account will be directly with the government.
Now the key word being tossed around here is “Programmable.” Through the use of this currency and the extinction of physical fiat paired with already fitted check-in points at most establishments, the government would have full control of all funds and the ability to trace all spendings and locations visited, while also determining what you can and cannot spend the currency on.
“Digital cash could be programmed to ensure it is only spent on essentials or goods which an employer or government deems to be sensible.” – cited from the Daily Telegraph, UK.
By definition CBDCs will not actually be used as money; it’s a voucher distribution from the banks and government. Eerily similar to the Chinese social credit score, the broad implementation of CBDCs leaves the door wide open to empower the banks and governments with tyrannical capabilities. They will have total control of the economy and functionality of society, and by result total control of what individuals can spend, do or say. This inevitably, one way or another, creates a power based society where personal choice, privacy, and human dignity are thrown away.