Know everything you need to know about CDBC or Central Bank Digital Currencies, a type of digital fiat currency that seeks to gain ground in the world using the power of banks, governments, and the enormous impact that technologies such as blockchain and Bitcoin have achieved with his vision of digital money. 

EThe birth, and subsequent growth of valuation, of Bitcoin It has led the world to go from being ignored to attracting great interest. A situation that has resulted in tens of thousands of cryptocurrencies, many interesting but the vast majority with hardly a value proposition.

Remember that Bitcoin seeks to completely displace fiat money, the institutional money of the banks. The IMF and central banks are aware of how deficient their money is, but they want to continue to maintain power over what gives power: money.

This search not to lose the monopoly of this modern slavery has led to the birth of the CBDC (Central Bank Digital Currency or Central Bank Digital Currency).

With this, it seeks to move towards a future of digital money where some financial and economic limitations of the current fiat money disappear. But all this, while maintaining control of the economy in a world that increasingly distrusts banks and institutions which have been guilty of so much suffering, wars, inflation, ... throughout the world year after year.

Central banks, with the media and governments at their service, want to do battle with Bitcoin, which is putting their monopoly at risk.

But what really are CBDCs? Do they use blockchain? What are its pros and cons? Do they exist today? Learn the answers to these and other questions below.

What is a CBDC?

A CBDC or Central Bank Digital Currency (in Spanish, Central Bank Digital Currency), is a form of digital fiduciary money that is issued by the central bank of a country and therefore has legal tender value in that nation.

CBDCs seek to give fiat money a new face. This together with functionalities similar to cryptocurrencies, responding to the needs of today's world. But all this without ceasing to be a control mechanism, one that is in the hands of a few.

CBDCs are not cryptocurrencies, they are not Bitcoin. They are hybrids, a response from countries concerned about the appearance of free cryptocurrencies in the world, especially, concerned about the loss of their economic and financial power in the world.

They are the latest attempt by institutions to stay alive in times when society already rejects them in a massive way.

This in addition to the fact that CBDCs are a form of money that can help them achieve different political, economic, geopolitical and geoeconomic objectives around the world, and where the espionage of citizens will reach levels never seen before.

The concept of CBDC is not something new, as is that of cryptocurrencies. The first mention of a CBDC was made James Tobin, in your paper "Financial innovation and deregulation in perspective" in 1985. Since then, the idea of ​​creating CBDC was always there in the air, forgotten by the sense of control that banks still had with the traditional model of money.

However, with the birth of the Internet, the arrival of digital payment systems, and especially with the arrival of cryptocurrencies, led these entities to rethink how to continue to have control of money. This led to the study and issuance of the first CBDCs in the world.

Objectives of CBDC

However What are the objectives of the CBDC? In principle we can identify the following:

  1. Generate a new form of money capable of taking advantage of the new technology that we have created so far.
  2. Facilitate the means of economic and financial interaction both nationally and internationally.
  3. Create new financial and economic structures capable of opening important investment doors for nations and the world.
  4. Stimulate competition between payment systems by making them cheaper and with greater scope.
  5. Create monetary policy control mechanisms whose action is immediate.
  6. Reduce the level of state intervention on banks by reducing the danger of the “Too big to fail” problem. This is a problem created under the fear that the failure of a major bank or company will bring down the economy. A digital system like a CBDC would be less susceptible to this problem.

Of course these are the objectives for the economy and finance, but additionally we can also mention:

  1. Create a structure that allows you to trace the course of money from its origin to its last actor at all times.
  2. Replace the anonymity of money with an anonymity controlled by the entities that control the CBDCs.
  3. Perpetuate political, economic and financial mechanisms, going beyond individual freedoms.

Although the objectives of the CBDCs may vary from those described above depending on the interests of the state and the central bank that issues them. In any case, the aforementioned objectives are the basis for the issuance of most of the CBDCs that exist today.

Nations, institutions, empires, end up disappearing. Central money too. But Bitcoin is free money, of humanity, and is based on mathematics, which will last until the end of humanity. In centralized money, all the financial information collected will be stored, ending up in the wrong hands sooner or later. Hacks are constantly happening, but even information can end up in the hands of bad politicians.

In the 10th century, after the First World War (the Great War), a politician with good intentions wanted to make a database of all the survivors, since many had lost their relatives and there had been a lot of immigration, so that when died, they could bury him respecting his religious condition for free. He wrote down who were Christians, Jews, Muslims, ... A few years after the Second World War came, that country was invaded by Hitler, who obtained the database, knowing all the Jews that were still alive. Only XNUMX% of Polish Jews survived.

Characteristics of CBDCs

Now, CBDCs like the cash we know today claim to have certain characteristics in order to be recognized as money. In this case, among the inherent characteristics of CBDCs that we usually find, we can mention:

  1. It is possible to exchange it between pairs (without knowledge of the issuer).
  2. Its acceptance is universal, a fact that is supported by its legal framework granted by the State and the institution that issues it. In this sense, its possession and use by any citizen is legal.
  3. It is anonymous and private.
  4. Its tenure does not accrue interest.

However, don't be fooled. Most of the CBDCs as they are raised do not fully comply with these characteristics, and we explain why:

  1. Yes, it is possible to exchange it between pairs. But this movement is known in real time from the bank. The structure that controls the currency is under the management of the banks, and they will therefore know at all times that you have made a transaction, the amount, to whom and even where you have done it.
  2. It is not freely accessible, the banks decide who is given access and who is not.
  3. Many CBDCs seek to achieve "controlled anonymity" to "deceive" citizens, however: If you have to ask permission to have privacy, do you really have that right?
  4. As for interest, it is true, the State and the banks do not want people to amass fortunes to make staking. The exception to the rule is when there are superior political or economic interests involved, under those conditions, the interests could be activated as a form of inflation disguised within the economic ecosystem of the CBDC. It's a revolutionary new concept of helicopter money. So they decide the particular rules, not working the same money for everyone.

As you can see, we are facing a technology and a type of money with which we must be careful. Because while CBDCs can help, they can be a terrible double-edged sword in terms of freedom and privacy.

How do CBDCs work?

The operation of a CBDC responds to the technology and needs with which said CBDC was created. In short, each CBDC works in a unique way and the technology used may vary according to the way it has been implemented by the central bank interested in it.

However, today many central banks have become interested in the technology blockchain and DLT to carry out this type of construction. This is because this technology allows minimizing the inherent risk of creating monetary systems that are supported exclusively by a digital medium. Likewise, DLT and blockchain technology facilitate the construction of interoperable systems with other currencies, as cryptocurrencies have demonstrated today. Additionally, they also allow the implementation of technologies that would otherwise be more complex or less flexible, such as the case of smart contracts.

An example of this can be the project HyperLedger of the Linux Foundation. This project is promoted by some of the largest technology companies in the world, such as Intel, IBM or Oracle, undoubtedly heavyweights in the industry. In any case, three of the HyperLedger projects (Fabric, Sawtooth and Burrow) are designed to apply blockchain technology for various business cases, and one of them is banking.

In fact, a number of central bank digital currency proof-of-concept (CBDC) systems have been built on the HyperLedger Fabric. A prime example would be the Singapore currency, the Ubin, and along with this other experience of Japanese-European origin, Stella. With this we already get an idea of ​​how important blockchain and DLT technology is in this world of CBDC as the backbone of the operation of a CBDC.

Of course, there is much more behind the operation of a CBDC and here we will comment on other important points in this regard.

Operating models

The operation of the CBDC will depend on the objectives pursued by said currency. In this case, four operating models are born, which are:

  1. Improve the functioning of wholesale payment systems
  2. Replace cash with a more efficient alternative
  3. Improve available monetary policy instruments, especially when faced with the lower limit of zero
  4. Reduce the frequency and cost of banking crises.
The flower of the money and its relationship with the CBDC

As you can see, each case generates (in gray) different areas where CBDCs are possible, each one with its own characteristics. In any case, it is clear that the objectives of the bank and the State define how a CBDC will work and what characteristics it will have at certain times.

Pros and cons of CBDCs

Among the pros that we can find in CBDC we can mention:

  1. In the first place, a CBDC allows the creation of payment systems, money issuance, and control of it in a much more efficient way, even in real time. This is something impossible to do with current technology.
  2. On the other hand, CBDCs can open the doors to greater financial inclusion for the citizens of a state. This is because it would be possible to create CBDC wallets in a much simpler way.
  3. It would generate greater competition in the payment system companies by reducing their rates.
  4. Provides improved tools to generate a healthier monetary policy.

But on the other hand, among the cons we can limit:

  1. There is no clear legislation yet on how CBDCs will be issued and controlled.
  2. There is a conflict between individual rights and freedoms, the use of CBDCs and their ability to spy on citizens.
  3. The fact that they are completely digital systems opens the possibility that they can be manipulated by hackers.
  4. Financial inclusion means manipulation and control. Since with bitcoin anyone can have financial inclusion without asking anyone's permission.

A CBDC is not a cryptocurrency. It is not Bitcoin.

But BEWARE! Watch out. It's easy to mistake a CBDC for a cryptocurrency. In fact, we suspect that institutions seek it that way. If people think that a CBDC is a cryptocurrency, what would they want to use Bitcoin for?

It is important to understand that a CBDC is very different from the quintessential cryptocurrency, Bitcoin.

  1. While Bitcoin is open access, a CBDC is not. Neither in the participation of the confirmations, nor to have an address where to have a balance.
    Transactions are monitored and spied on, knowing the consumption pattern of each citizen: purchasing power, places where they consume, frequency, ... everything.
  2. The issuance of money is centralized, controlled by an institution dominated by people who favor who they want: banks, companies, governments, ... Think every time there are money issues to "save people" from the financial catastrophes that they create Does the money go to the people? No.
  3. The money goes back to banks or companies, which between intermediaries keeps all the money along the way. Instead in Bitcoin it is issued mathematically, agnostically to any government.
  4. The powers suffocate those who do not like. And the network of interests involves governments, financial institutions, companies, ... Think of the United States, and so many other countries, and how their pressure has led countries to absolute misery. Or think about how Wikileaks has been silenced in every possible way, even financially suffocating it. With Bitcoin they cannot suffocate anyone, be it Wikileaks, Cuba or any citizen.

How much do you know, cryptonuta?

Will CBDCs really be digital currencies that respect our privacy?


One feature that CBDC creators (that is, central banks) often promote with great fanfare is that they will respect your privacy and give you anonymity, but nothing is more false than that. A CBDC currency controlled by a bank, where they have your data and access to all your transaction history, is simply an open book for them to spy on your economic and financial life without any hesitation or shame.

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.