The Dangers of CBDCs

The Dangers of CBDCs

By Theincomebeast | Theincomebeast | 31 Dec 2020


Everyday we hear more and more talk about central bank digital currency (CBDC) It also seems like everyday there is a different central bank talking about launching their own CBDC.

 

I wrote a short post about China launching a CBDC here. I do not think it is any stretch of the imagination that comes with the potential tracking and controlling that can be done with a digital coin. I know there are many arguments stating that when we use a credit card we are already willingly giving up all of the information about where we shop and what we are buying and how often we are buying it. Additionally any of us who have ever had a card shut off know the power the credit card companies have over us.

 

Having your “funds” locked up or turned off is no picnic and can be a real issue. I have been traveling overseas when my credit card issuer determined that there were fraudulent charges being made and suddenly cut my access to credit and my funds. After finally having to call the bank’s fraud detection dept and verifying my purchases I was able to get going again but it was a significant speed bump for me.

 

The thought that the government (or whoever) basically having the ability to freeze your assets probably does not cross the mind to the average American but this potential does exist and in some countries in the world this could be a real issue. The powers that be could simply freeze your accounts because you are from a different political party or for something as benign as liking a social media post that they do not like.

 

The widespread acceptance of the CBDCs will give even more power to the powers that be as you are literally surrendering your money to them. There will be those who say you have nothing to worry about if you are a law abiding citizen and to those people I would say that they need to brush up on their history.

 

One of the best things about decentralized financial systems is to keep what is yours in your pocket and not give anyone the ability to get their hands on your funds. We are in the early days of financial privacy and I admit that for most entering the crypto world requires fiat currency and a bank account to get started but soon that will probably be a thing of the past.

 

As long as people are willing to do a little work to remain anonymous they will be safe from big brother tracking everything they buy or sell. It starts with getting away from the mainstream banks and opting out of all the “freebies”. You might be wondering what I mean by that. Well, I bet you have a discount card for your local grocery store to save on those weekly specials, or a frequent flyer number that gives you discounts or free flights. If they were not using all your data then how or why would they offer these incentives?

 

In closing I think that the idea of CBDCs are great, great for the banking industry and government and bad for the end user. Personally I would not recommend signing up or using CBDCs unless you have done the research and know what you are really getting into.

 

What are your thoughts about CBDCs? 

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Theincomebeast
Theincomebeast

I am an avid investor who likes to share information so that everyone can become financially literate. Interested in alternative investments and crypto.


Theincomebeast
Theincomebeast

This is my blog where I encourage others to learn and share information about financial literacy. I am enthusiastic about alternative forms of investment and cryptocurrencies.

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