CBDC: the fiat 2.0
Greetings crypto lovers , in history there are times when societies face the problems caused by centralization, the rise of central banks and the subsequent creation of fiat have shown, today with the initiative of countries and Central banks creating digital currencies is a much bigger step to the economic disasters of recent times.
What is the CBDC and why is it a fiat 2.0?
The CBDC or Central Bank Digital Currency as its name indicates is the digital currency of central banks and like conventional fiat currency is insured by the central bank of the day, the CBDC is the incorporation of the elements of cryptocurrencies to compete against these.
The innovations that bring banks and the current government is much more control on transactions , not only that but that this being a digital medium many of the ace things that makes the currency fiat that we have today will be more easily achieve for banks (manipulate interest rates, save irresponsible banks, create money based on inflation).
Why is CBDC a huge problem?
The enormous concern is not limited to China's use of the CBDC to control its population, but to the rest of the countries that have joined this race to create their own CBDCs, the uses that will most likely be seen in China as the closure of accounts to the "enemies of the country" or the limitation to buy certain products is not something that only China will do but it is realistically something that other countries can do.
The unfounded belief that talks about how democracy will use the CBDC in a good way is at least a very distant dream, the CBDC will be a centralized tool that will give unimaginable power to central banks and bureaucrats to control the population.
Things like tax evasion or money laundering will be imposi bles and users of these coins may expropriate property and savings in seconds, they can make disappear currency accounts users if not used in a product or service, ironically those kinds of tools were the greatest fantasies of people like Hugo Chávez in Venezuela.
Reflections
With everything addressed on this topic, perhaps some will say that such a thing will not happen in the West, and I will be honest that it may not happen in the short term but in the medium or long term it is completely safe and this is because things as counterweights against this environment centralized is much more difficult to be used if you use this fiat 2.0 compared to the 1.0.
History has shown the laws that govern our societies were not born of bureaucrats, they were born of societies that created them to avoid a perpetual state of war among citizens who defended themselves against any outrage that was done to them and because of that the governments limited its authoritarianism for fear of the rebellion of citizens, if today we do not seek decentralized means of money such as cryptocurrencies, we will most likely be in the disaster that will be the future with the new authoritarianism that fiat 2.0 will mean
I also recommend this blog a bit https://www.publish0x.com/the-economy-and-cryptos/fiat-money-and-central-banking-xmmdmrl, which talks about central banks and fiat 1.0.
