CRYPTOCURRENCY & CENTRAL BANK DIGITAL CURRENCY (CBDC)

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Many people flock to cryptocurrencies for financial diversity, security, and to escape from the fraudulent fiat currency system.

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Commonly know cryptocurrencies include BitCoin, Ethereum, Monero, StableCoin etc. Running on Blockchain technology, these cryptocurrencies are considered private, untrackable, and secure by design. However, one should know that nothing on the internet is really secure.

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​However, one must also understand that while fiat currency is fraudulent, likewise cryptocurrency is also based on NOTHING. In the current system, both fiat currency and cryptocurrencies are nothing but numbers on the computer screen.

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What Is CBDC?
Central Bank Digital Currency (CBDC) is a digital currency issued by a country’s central bank, similar to a cryptocurrency, except its
value is fixed by the central bank and equivalent to the country’s fiat currency.

Aside from being a liability of the country’s national central bank versus a commercial bank, the main difference between a CBDC and money in a checking account via debit card, or any eWallet, is that dollars used in traditional accounts are entirely fungible and interchangeable. Each dollar is identical.

CBDCs, on the other hand, are programmable, unique, and easily surveilled. This uniqueness and centralization mean they are entirely under the monitoring and control of the federal government. This includes all transactions, savings, and investments with a CBDC.

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Like paper dollars, a CBDC would be a liability of the Federal Reserve. Unlike paper dollars, it would offer neither the privacy protections nor the finality that cash provides. While a CBDC would not offer any unique benefits to Americans compared to existing technologies, it would pose serious risks.  CBDC could spell doom for what little financial privacy protections remain.

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The key difference with the CBDC is the Central Bank will have absolute control on the rules and regulations that will determine the use of that expression of central bank liability.

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The threat to freedom that a CBDC could pose is closely related to its threat to privacy. With so much data in hand, a CBDC would provide countless opportunities for the government to control citizens’ financial activity.

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Freezing / Seizing Assets

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Governments have long recognized that freezing someone’s financial resources is one of the most effective ways to lock them out of society. However, a CBDC could make the process easier and faster for governments by establishing a direct line between citizens and the government itself.

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Negative Interest Rates

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While interest rates are typically thought of in terms of positive rates, a CBDC could allow policymakers to also set negative rates. In effect, a negative interest rate would result in people losing money. Proponents argue that this strategy could be implemented to spur spending.

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Programmable Spending

The programming capabilities of a CBDC could mean that people would be prohibited from buying certain goods or limited in how much they might purchase. CBDC can allow government agencies and private sector players to program targeted policy functions. By programming a CBDC, money can be precisely targeted for what people can own and what people can do. Also, CBDCs function as time-limited vouchers, thus not allowing people to save up, only to spend whatever they have on hand.

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Financial Security

Another concern is the central storage of financial information. Where an IRS breach puts all citizens at risk, a breach at a private financial institution would only affect a fraction of citizens—leaving customers at other banks free from harm.

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