A US-Based Group Opposes The Creation Of CBDC In The Nation

A whitepaper published by a US-based nonpartisan organization, Bitcoin Policy Institute, has opposed the adoption of Central Bank Digital Currencies in the country. The non-profit making group, which aims to review bitcoin’s effect on society and the financial system, disclosed this in their latest publication.

Reasons For Opposing CBDC

The paper, written by Natalie Smolenski (Ph.D.), and Dan Held, claimed the CBDC creation threatens to deprive United States citizens of personal and financial freedom. Meanwhile, Smolenski is a director at Texas Bitcoin Foundation, while Held is a former growth head at Kraken. The authors proposed stablecoin and Bitcoin as logical options.

Further, the writers explained that through the CBDC, the authorities would have unrestricted access to all the monetary dealings regardless of the location. Consequently, it could expose the government to more attacks from internet criminals, which they believe the government lacks adequate specialized personnel to repel.

The CBDC will grant the authorities absolute monetary control. The pair also complained that it would be utilized by the government to implement various economic decisions like tax increments, unfavorable bank rates, and others.

The writers also urged the United States government not to follow the Chinese trends like other nations. They further explained that intense supervision of cryptocurrency is similar to Chinese policy, which mandated all financial activities passing through their supervision.

Possible Alternatives

The writers agreed that well-backed and regulated stablecoins coupled with the BTC and the Dollars would seamlessly cover all the motives of creating digital currency by the apex bank.

Bolstering their points further, they asserted that stablecoins and BTC provide faster and cheaper digital transactions in the country and globally. The stablecoins and USD will also ensure adherence to the KYC and anti-money laundering regulations.

Additionally, the report stated that the authorities lacked the potential to maintain adequate stability if they created their crypto. Also, the citizens might find it challenging to rely on their virtual assets.

Furthermore, the writers believe that a stablecoin backed by globally issuable hard collateral would be better than the central bank’s cryptocurrencies. They added that it would wade off the unnecessary control of apex banks’ cryptocurrencies.

The US authorities are yet to reach a consensus on the creation of CBDC, although many countries are already building theirs. However, President Biden requested a review of 18 systems of CBDC to be presented by the Office of a Science and Technology Policy recently. That signals possible actions towards creating the cryptocurrency even though the Bitcoin Policy Institute urges the government to reject it.