One such is the Bitcoin proponent and Blockstream CEO Adam Back, who said CBDCs are worse than bank accounts. In the latest tweet, Back vouched for Bitcoin as an “apolitical, bearer, unseizable money” and argued that CBDCs, on the other hand, are “systems of control.”
Back went on to add that the digitized version of fiat will be “worse than paper cash, worse than stablecoins, and much worse than Bitcoin.” This isn’t the first time the legendary cypherpunk has noted that Bitcoin’s self-sovereignty feature makes it superior to current projects under development. In 2019, Back had said Diem (formerly Libra) could act as competition for online banking but poses no threat to Bitcoin.
The latest comment comes in the backdrop of former Blockstream chief strategy officer Samson Mow’s discussion on CBDCs at the Asian Leadership Conference. Mow opined that the motivation around the CBDCs is not to facilitate transactions confidentially.
He also highlighted the need to go back to apolitical money and the “best way” the exec believes would be to move forward by adopting Bitcoin as money, similar to countries like El Salvador.
“Central banks could do it correctly if they implemented a CBDC that was private and had a way to transact confidentially. But that’s not the motivation for a CBDC. Even in Canada, the bank that (released) a job posting looking for engineers to build a system, and the summary was – we want a central bank digital currency that is private, but not too private. So I just can’t see it happening in a correct way.”
China has been one of the top contenders in the CBDCs area and reportedly has nearly 250 million registered digital wallets using the Yuan’s digital version. Other countries such as India, Japan, and South Korea are also leading the way in pilot testing efforts.
However, the US, the UK as well as Mexico are dragging their feet and are still stuck in the research stage.
It is important to note that Russia’s invasion of Ukraine has fueled interest with regard to wholesale bank-to-bank CBDCs even in countries that were nowhere in the progress. Banking sanction was another catalyst.
However, not everyone believes a CBDC should come from central banks. Philip Lowe, Governor of the Reserve Bank of Australia, recently vouched for digital tokens issued by private companies because they are better at innovating and could potentially offer more benefits than the ones by central banks.