The European Central Bank has warned the tech sector may outpace governments if they don’t jump on the digital currency bandwagon soon. The fear is real and the ones that got scared are actually the powers which so far have been on the other side of fear.
CBDCs are quite often talked in the crypto space and it's no mystery anymore that China is working hard to launch its digital yuan, a digital currency that will further strengthen the state's control over its citizens and their funds. As much as those governments are trying to portray CBDCs as cryptocurrencies, that's not actually the case.
“Just like the Chinese digital yuan, the ECB's digital euro is ultimately meant to track users. This runs counter to the fundamental spirit of cryptocurrencies, which at their core attempt to liberate money from state control.”
-Pieter Cleppe, EU policy analyst at Property Rights Alliance (PRA) for Decrypt
The situation is pretty clear in China and I doubt there's any way out of the tyranny from over there. No wonder so many Chinese are migrating to other parts of the world. When you have a government telling you how many kids you should have, making you a digital social profile that decides whether you deserve a vacation or not and working on a state created digital currency that is under total control of the government, it's crystal clear you have to search for alternatives.
Why does the EU for example rushes the digital EURO?
It's afraid of "artificial currencies" that might undermine the state/central banks power. We're at a point where almost any individual or company can mint its own money and this can have value in the real life. Cryptocurrencies are such examples. Although showing it once in a while, seems like European governments are rather afraid of currencies such as DIEM from Facebook rather than Bitcoin.
Facebook has become a true digital world with the potential of creating a digital economy of its own, "threatening to launch its own currency". If this would become real then governments are in the position of loosing an important financial power they had over citizens.
If Facebook manages to do what it plans and millions in Europe start using the DIEM, the EU and local governments will loose a bit of control over their citizens. Some cash transactions and wealth distribution might start flowing under their radars. I'd say though that governments are shitting their pants because of DIEM AND Bitcoin/crypto.
Both are rivaling with current financial system and so far crypto has proved to be a better alternative than the current one. As I wrote many times on my blog, the only thing we need asap for crypto is more mass adoption for such currencies as payment currencies. When we will have bars, coffee shops, sports clubs, etc that have digital wallets that you can use to pay for whatever, we can say we've gained back a bit of our lost freedom.
We are at a turning point right now, where technology threatens to take the control from the governments and put it in the hands of the people and centralized authorities trying their best to save what's left from their authority. The society is in a crisis, whether some acknowledge it or not. It might not be that visible from a financial point of view, but the crisis is here and the planned covid pandemic has worsened it.
I have a feeling that the world powers aren't even that tied anymore. The enemy of the state is no longer wearing boots and shoots guns. This time we have "invisible tech" that can leave governments powerless. One of the strongest tools in the hands of central authorities to enforce control over a large group of people is to control the money.
When you no longer control the money and personal finances, when you have wealth with the potential of being generated out of thin air, pretty much similar to how traditional currencies are being minted, but in a decentralized manner, what authority are you left with? China has come to that understanding and that's why it's ardently working on creating its CBDC. The threat is real and those artificial currencies, hopefully crypto, have the potential to restore a lot of freedom and trust that has been lost over the years.
The money flow will no longer be tied to private banks that can easily be controlled by governments and elites behind these governments. Exchanging one currency to another and "carrying such currencies" all over, and are easier to use than fiat money, is the real threat of traditional banking and the puppets those control. Artificial currencies might take control over the artificial power governments used to have on us. We just need a bit more people to comprehend the concept of decentralized blockchains and cryptocurrencies.
Thanks for attention,
Adrian