Finally, a report on some of the dangers of a truly digital central bank currency. It’s issued by the UN no less! Will it make any difference to the central banks attempting to make such a currency. Certainly not to the major ones.
The major central banks are interested in control of currencies. That a dictator is abusing currency is not going to change their minds about what is to be done. Nonetheless the report has been issued and circulated. It is from the the UN Economic Commission for Latin America and the Caribbean (ECLAC).
The report, published on 1st May, says blockchain-based systems have many good qualities but can help a dictator find out a great deal about his subjects.
A CBDC would have the potential to be a very potent tool for social repression in the event that a dictator was to come to power. Under CBDC system, this hypothetical dictator would have the ability to deny participation in the financial system to political dissidents, and would also have access to a very complete picture of all entities having financial relationships with those dissidents.
This isn’t the real problem with blockchain and cryptocurrencies. The major problem is with the central banks themselves that want the ability to know about every single transaction possible and are counting on cryptocurrencies and blockchain to accomplish that task.
Heaven help us if we get to the point where transparency is so great that people cannot use cash as they choose. Already various regulations impinge on cash transactions using various guises that have proven in main to be untrue.
There can only be more upcoming and whether or not new currencies will be abused by dictators is not something big central banks will care about as they struggle to saddle the new currencies on us.