CBDCs Are Coming and They Might Not Be What You Hoped For

Earlier China announces it's release of a all digital asset for their currency otherwise known as a CBDC the kicker with theirs however is it has an expiration date. Use it or lose it. Now it seems like every government is seriously considering their own CBDC in fact July of this year the USA is set to release specs and testing of their own CBDC.

In the crypto space people wanted this a stable coin that could be used for everything and fully backed.

But it's not what you think...

CBDC stands for Center Bank Digital Currency and it's something governments including the USA seem to be heavily after while also attacking other methods of payment such as gold, silver and yes even our wonderful cryptocurrency.

How much do people trust the government to do this and do it right... Well not so much...

For the most part peoples fears and so they should be are the end of financial privacy and any real privacy. But let's not jump into that just yet let's take a look at some key fundamentals.

The new payment processor coming out is called FedNow and is expected to release in July of this year. FedNow is a system that will work with banks. Instead of waiting days and sometimes a week if you hit the weekends and holidays just right your transfers will happen near instant and transfers between banks will be near instant as well.

FebNow will only be available to banks and people within the USA and to be honest it's a step in the right direction for banks. Lower fees, faster transactions and at some point they want it to replace and be like the systems such as venmo for peer to peer transactions but that's not expected to be released until later.

This all connects back into the CBDCs which are currently in the works. Instead of a bank sending a IOU and slow transactions along with middle man 3rd party banks to verify the money exists. The CBDC would instead offer up near instant transactions and move everything into a digital format meaning that money in circulation in pure digital form does in fact exist and does not need a 3rd party bank to verify it.

Sounds a bit like crypto and the blockchain right? Well it is but with some MAJOR things you need to be aware of.

It's Fully Centralized meaning the Fed/Government has full control over how fast transfer move, how they move and yes full insight into every transaction that takes place on a ledger that can be called up at any time.

That means the government has a full look into everything and will instead send us the tax bill for how much we owe. Not sure I like the sounds of getting an invoice from the government

It also offers up competition now to all banks making it that fees, late charges etc that banks are extremely predatory on just wouldn't be a thing anymore with a CBDC. That would cause a large sum of revenue for a bank to stop and really renders banks obsolete when you think about it.

There's a vast majority of downsides to this and the only upside really is for the government when you really start to pull back this onion.

Directly in the CBDC write up it's noted that the CBDC will be tied directly do you via a digital ID and social identity proof. This gives the government full control in theory to freeze your assets at any given time for any reason. It gives the government full control to also control, manipulate and honestly control peoples spending and wanting to spend their money throwing up expiration dates on digital CBDCs like China is doing.

Think the USA government wouldn't do that? Think again... A government never relinquishes power but instead only acts to issue more and more control over it's people and remove their freedoms until the point the people have had enough and rebel only to hopefully get those freedoms back, usher in a new government and then repeat the cycle all over again.

Take a look at this

This is an executive order on April 5th 1933 which made it illegal to hold any type of gold or silver bullion yourself. If you didn't agree to do so.. You got a nice little 10 years in prison and an up to $10,000 fine which was a rather large amount of money for someone back in 1933. In fact a quick conversion shows that fine would be the equivalent of about $232,000 in todays money and that was PER YEAR in fines.

Now on the other hand it could be the exact thing the government should be doing to innovate the USD to the next level and restore trust back into the USD. One thing is for sure that the government has to make this step otherwise be left behind.

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