Bitcoin Policy Institute Pens Paper Calling On U.S. To Reject CBDC – Bitcoin Magazine
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The Bitcoin Policy Institute (BPI) has released a report detailing why the United States should not create a central bank digital currency (CBDC) and instead promote freedom and privacy, according to a press release sent to Bitcoin Magazine.
BPI begins by exploring the strong possibility that the 21st century will be known as the “Chinese Century,” referring to China’s authoritarian use of the CBDC and other forms of military, economic, and cultural hegemony.
Thus, as more countries begin to develop and issue their own versions of CBDCs, it is becoming increasingly clear that governments are competing not only to maintain their authority over legacy finance, but also to aspire to an entirely new level of power.
“People today can only trade at the behest of the state through banks that use police power as quasi-state institutions,” the report reads.
Therefore, the BPI urges the US government and central banking system to pursue a new path; a path that strengthens privacy and increases freedom.
“As the world goes China’s way in the 21st century, the United States should stand for something different: it should stand for freedom,” the statement said. “This is why the US should reject central bank digital currencies.”
However, if the US rejects the idea of CBDCs, then something will have to solve the problem of the need for digital currencies, specifically the need for digital fiat that allows for low fees and virtually instant cross-border transactions.
“The highly regulated and controlled world of digital money suggests that a meaningful alternative must be private, uncensored and free,” the report said.
“These are the characteristics of bitcoin: a global cryptocurrency issued by a protocol and not a bank,” the report continues.
Fortunately, Bitcoin offers all of these essential benefits: instant, low-cost or free transactions, domestic and cross-border transactions, final settlement, no built-in surveillance or transaction monitoring, and no central entity that can control Bitcoin’s monetary policy.
In addition, the BPI noted that Bitcoin is likely to work in tandem with privately issued stablecoins from banking institutions, although it is not clear whether this is necessary. However, this idea helps bridge the temporary gap associated with the issue of digital fiat access.
“To solve this problem [access to digital fiat]private banks can issue crypto-stable coins that are pegged to fiat currencies and backed by 1:1 collateral.”
The report concludes by urging the United States to take a harder path that strengthens privacy and guarantees freedom without centralizing power in a system that is likely to breed future abuse.
“We live in a world characterized by the systematic erosion of individual privacy that inevitably leads to the loss of liberty,” according to the report.