Juan Villaverde has been an economist and mathematician since 2012 and deals with the analysis of cryptocurrencies Weiss Ratings Team of analysts and computer programmers who created Weiss cryptocurrency reviews.
Dr. Bruce Ng is a Distributed Ledger Technology (DLT) educator and has been a leading crypto-tech analyst for Weiss Cryptocurrency Ratings since shortly after its introduction.
Last month the People’s Bank of China The new digital yuan was tested in Shenzhen, the border town next to Hong Kong. It was a great success.
More than 2 million people queued to become one of only 50,000 test users.
This is the first major central bank (CBDC) digital currency released in the real world. But it won’t be the last. The Bank of France and the European Central Bank both are racing for a digital euro.
The IMF (IMF) recently held a conference on how CBDCs can accelerate and reduce the cost of cross-border payments.
The US Federal Reserve also thought about a digital dollar. In fact, a law to establish and implement has already been proposed in Congress.
So, in the words of the prophet Daniel: The writing is on the wall.
Why digital versions of fiat money will be the enemies of democracy
CBDCs are being sold to the public as a technical upgrade to make payments and transfers faster and with no transaction costs.
For example, citizens would each have their own digital accounts at the central bank. To pay a bill, simply use your smartphone to transfer CBDCs from your account to the account of whoever you owe.
In fact, this is very much like accessing online too existing Bank accounts are already working. This explains why the people of Shenzhen were so happy to accept the digital yuan.
Once CBDCs are rolled out nationwide, privately owned commercial banks will face a not-too-distant future where they may no longer be in business. Because most of the transactions would be between accounts at the central bank, which makes them unnecessary.
However, this is only part of a more ominous story. Some countries will be tempted to use CBDCs to create a system like this:
- Tax policy is automated. The central bank computer will decide you owe taxes and those funds will disappear from your account immediately. With or without Your permission!
- The money is completely controlled by unelected bureaucrats. Not only monetary policy, but also money itself – who has access to it and how much – is not determined by politicians who are accountable to the electorate, but by unelected central bank officials.
Keep this in mind: under a CBDC regime, debates like the one in Washington over whether to provide more pandemic relief after the elections could become irrelevant.
Why? Because having direct access to every citizen’s accounts would effectively hold the Federal Reserve – not Congress – responsible for US fiscal policy.
And mark our words, many politicians would be okay with that. Because they would prefer voters (instead of them) to get angry at the Fed when burdensome and undesirable taxes are inevitably due.
CBDCs are “more efficient” – similar to how monarchies are “more efficient” than democracies
Under a monarchy, one can go from prince to peasant just by drawing the king’s wrath. Similar patterns could occur in a CBDC world.
Insult the wrong person and you will be penniless by decree – that is, you will be denied all access to money – at the push of a button.
The choice couldn’t be clearer. Do you want autocratic rule and top-down decision-making? Or freedom, democracy and accountability of the ruling class?
Little by little, abuse through abuse, people today must learn an age-old lesson: Bad things happen when too few people have too much power.
If America’s founding fathers were still alive today, they would undoubtedly advocate Bitcoin (BTC) and other crypto assets – to challenge the all-encompassing power of an unelected technocratic bureaucracy.
If you value your financial freedom in the future, cryptocurrencies could soon be your only choice.
But no matter what, the message is clear. ATTENTION TO THE CENTRAL BANK’S DIGITAL CURRENCIES.
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