There is an interesting article on COINTELEGRAPH today about legislation that Ted Cruz introduced into the US Senate. The tagline indicates that it will keep the US off of “an insidious path akin to China’s”. This bill attempts to prevent the Federal Reserve from issuing a CBDC (Central Bank Digital Currency) directly to US citizens.
The article indicates that this legislation will prevent our critical personal data from being held by the Federal Reserve which would potentially be a security risk and also it would prevent our government from being able to use these accounts as “surveillance tools.” The intent of the legislation is to require the Federal Reserve to broker the CBDC through private financial institutions.
While this legislation should be helpful it really seems to me that the horse is out of the barn, a mile away and picking up speed. The horses name is “Bitcoin” and it was created due to the abuses of the PRIVATE Federal Reserve System that is operated for the benefit of it’s shareholders and not the US citizens.
For a little background…
the dollar (Federal Reserve Notes or FRNs for short) is already digital for the most part with less than 10% of currency being printed or in coin. The rest are digits in the computer system. The key is that with the legacy financial system banks and financial institutions maintain the clearing system for tracking and maintaining balances in our accounts.
With Bitcoin the combination of cryptography and a distributed database called the “blockchain” is the system that maintains the balances in your wallet ( which are “accounts” in the legacy financial system). Bitcoin (and some other cryptocurrencies) perform this task in a frictionless manner. When you process a Crypto transaction the transaction occurs typically within seconds. There are no lengthy clearing times like you get with credit cards currently or the delay in having a check deposit hit your checking account for instance. Additionally, you don’t have to reconcile your crypto wallet because it is either in your wallet or not. Similar to how you don’t have to reconcile the paper Federal Reserve notes that are in your leather billfold.
Bitcoin is setup to run automatically on a distributed ledger that no government can shut down. It is also immutable meaning that past transactions cannot be changed so every transaction is available for analysis. New coins are issued according to an algorithm and not by dictate like in the legacy financial system.
So a CBDC is a digital currency (which the dollar is mostly already) but it is also programmable which means they can control it according to their whim. It is more of the same but worse.
Back to the article…
The author wraps up the article by stating the Democrats have also introduced legislation this week to introduce a digital currency that is issued by the treasury but is not blockchain based and is based on your device and not accounts.
My advice is to stay away from both CBDCs and the Democrats new baby. We are able to start stepping out of their corrupt system with Bitcoin.