CBDC projects today
Now, what CBDC projects exist today? Those that are publicly known are still few and most of them are projects still under construction. However, virtually all central banks are prototyping. Here we mention some of the most important or known in this field.
You have to bear in mind that all these projects are similar projects, with their nuances, but on the same money model: fiat money. Remember: don't be fooled, Bitcoin is a radically opposite model to the CBDC model.
El Chinese digital yuan or DCEP (Digital Coin Electronic Pay), is the CBDC currency of China and the one that in the last two years has attracted the attention of the world. China is the first major economy in the world that has bet heavily on transforming its money into a form of digital money. To achieve this, they have opted for private blockchain technology, with an unknown consensus algorithm.
The reality is that DCEP is currently the project with the most media coverage in China, but about which we know very little. What we do know is that China seeks to link its current fiat, the RenMinBi (RMB) 1: 1, and transform DCEP into the national and international currency that projects Chinese power. In this way, China seeks to strengthen its political and economic presence around the world, something that many of its neighbors do not see with a good eye, for example, India and Taiwan.
China has been for many years a country with a very contrary position to free cryptocurrencies. It has even gone to the point of financially persecuting the nation's miners, banning the trading and establishment of cryptocurrency companies on its territory. Despite all this, China is betting on private blockchains under its political and economic control.
The task of carrying out this project falls to the People's Bank of China (PboC) together with a conglomerate of private and public companies that serve as the development committee of this currency. Among the systems that would use this currency are giants such as Apple Pay China, AliPay and WeChat, which could make this currency available to more than 1,8 billion users worldwide.
DCEP is under Chinese law, and that brings serious problems. First of all, the currency is declared non-anonymous, in fact, everything is controlled by the central bank. Thus, from your entry into the system, each DCEP unit that you control and in which you use it is known to the Chinese government. The situation is worse, considering that China reserves the right to veto and restrict access to the system if it deems it convenient for its national interests. In fact, one order is enough to freeze the entire system and render DCEP inoperable for a country and its citizens should they adopt it.
Meanwhile the world is still waiting for the arrival of DCEP which seems to be planned for the year 2021, and is expected to be widely used in the Beijing 2022 Winter Olympics.
EUROChain on the other hand, it is a research project of the European Central Bank with which they seek to recognize the potential of a digital currency based on the euro and issued by the ECB. The project was made public in December 2019 by a paper named "Exploring anonymity in central bank digital currencies".
In this paper, DLT technologies (more specifically R3's Corda) are explored for the construction of a CBDC for Europe. The result? Something very similar to the DCEP of China, a currency with controlled privacy, and with a control structure that exceeds that of current systems.
On the other hand, FEDCoin is a digital currency project but in this case carried out by the United States Federal Reserve. The US project is driven by the need to compete against China's DCEP, its main competition and global threat.
Along with FEDCoin, FEDNow is also born, a service that seeks to allow banks and other institutions to carry out operations in US currencies instantly 24/7. The service is intended to be a flexible and neutral platform that supports a wide variety of instant payments.
The launch date for FEDNow is 2024, but for FEDCoin, there are still many doubts. However, the creation of FEDNow already enables the ability to put FEDCoin to work, so the only thing that stands in the way of its launch is just one thing: US law must change to create a digital counterpart to the dollar and for it to be accepted. as legal tender in the country.
El Petro It is a digital currency designed by the Venezuelan government. Its creation and launch is perhaps the most controversial coin development out there. If you want to know everything that this project contains, you will soon be able to read our article What is Petro? In it, we relate all the points of interest about this project.
CDBC, a threat to cryptocurrencies and our freedom?
Now let's ask ourselves a question Are CBDCs a threat to cryptocurrencies, our freedom and privacy? If you have read and analyzed this article, you will surely have already given yourself a clear answer to this question. Yes, they are, a pretty serious threat in every way.
How can Bit2Me Academy say that money based on blockchain technology is not good? If you are asking yourself this question, it means that you still have to learn more about cryptocurrencies. We bet on cryptocurrencies like Bitcoin, not on the fiduciary, either on paper, and much less digitally.
First of all, they threaten cryptocurrencies because they rise above concepts like blockchain and DLT that are very much in vogue today. Many people who approach the crypto world do so because they want to escape the enormous control that states are beginning to exert over our economic lives. A power that has always been there, but with new technologies there is finally an alternative.
Given this situation, decentralization and the freedom offered by cryptocurrencies could be in danger. If governments create regulations that offer a boost to CBDCs and slow down cryptocurrencies, you could little by little lose the interest of the population, especially for fear of falling into legal trouble, or paying more taxes for having cryptocurrencies, or whatever. whatever the government imagines to discourage the migration of people out of its "Financial corralito". Governments, to avoid being classified as dictatorships, should only raise taxes, discouraging their tenure.
Think about it a bit What better way to kill a cryptocurrency project than to plunge it into bureaucracy, FUD, Paleolithic laws and excessive taxes? It is true that it is a "dirty" method, to put it in some way, but we are talking about governments that saved the banks with your money.
On the other hand, if we want an Orwellian world, CBDCs are part of the path that will lead us there. At this time, banks have enormous power to withhold money if something does not agree, or to block company accounts that go against these interests. This happens to Bit2Me. Imagine now that that power is increased. We talk that every operation you do will be something that some people in the shadows will know, they will have a great eye on you observing you every minute of your economically active life.
That is a huge amount of data about us, data that will surely end in a big Big Data that will allow the government to know who we are, our tastes, customs and others. Too conspiranoid? For nothing, it is already happening, creations like Facebook and Twitter already shape the thinking of millions thanks to that Big Data, and if you add economic data to this, you will only do one thing: improve that capacity. Any political dissident,… even we ourselves write this text with fear of the consequences of it in the world in which we already live today, and that we already live in our flesh.
They say that money gives power. How much power does owning what gives power give? This simple question reveals how unbalanced people are with traditional money. If it is also now purely digital, losing our privacy completely, the picture is much more worrying.
It seems absurd, right? All concerned with changing our work and time of our life, like machines, in exchange for a "money" that makes us more and more slaves. Without a doubt, for the powerful, a master move.
To take control of the money from them is to take away the power to do the misdeeds that they do to us in that traditional model where we are simply "pawns in a game of chess." Bitcoin is gaining ground, returning power to the people, democratizing money and making control of it homogeneous. It is normal that they want to fight, because Bitcoin hits them in the heart in a precise, certain and deadly way.
A war has been opened: that of slave money (the CBDC) and that of free money (Bitcoin). Which side do you want to be on?
Since you have read this Tell us what you think about CBDC? Let us generate debate, let the community know the good, the bad and the horrible of CBDC, and generate interest in preventing them from becoming the Orwellian tool they want them to be.