CBDC represents a very special segment of blockchain technology. At its inception, it attracted positive sentiment. However, this has changed significantly over time, to the point where central bank digital currencies have been called cryptocurrencies by Edward Snowden.
An unforgiving opinion
Edward Snowden is a former employee of the Central Intelligence Agency (CIA) and the National Security Agency (NSA). Because of his whistle blowing adventures and the knowledge and experience he possesses, many people rely heavily on his opinion. On October 9, Snowden, in his publication, very directly expressed his opinion on the CBDC. As he points out:
“CBDC is not, as Wikipedia might tell you, a digital dollar. After all, most dollars are already digital, existing not as something in a wallet but as an entry in a bank database. Nor is digital central bank currency a state-owned form of cryptocurrency – or at least not cryptocurrency as it is currently understood by almost everyone in the world who uses it.”
Snowden, in a continuation of his statement, points out that CBDC is a sort of “perversion of cryptocurrency” and the opposite of the assumptions that guided the crypto sector’s founders.
“It is a form of cryptocurrency, an evil twin put on the ledger, explicitly designed to deny its users basic ownership and place the state at the intermediary center of every transaction.”
The former CIA employee also says he would be happy to ask representatives of the Federal Reserve and the U.S. government whether centralization of money by the state is really necessary.
What are CBDCs
Opinions on cryptocurrencies are divided. Blockchain technology, on the other hand, meets with much more approval. Its potential is recognized by governments, working in many countries to introduce CBDCs, or central bank digital currency. What distinguishes CBDC from Bitcoin, for example, is that it is a state-centralized form of money. Bitcoin, on the other hand, does not have its own central issuer, which makes it meet with a much more flattering reputation among its users.
However, the lack of control over its issuance is sometimes problematic for those in power. One of the countries working most intensively on its digital form of money is China. Their simultaneous extremely negative attitude towards Bitcoin fosters fears that CBDCs are competing with it. There is also concern about the practices that countries may use CBDCs to stimulate local economies. These include putting an expiration date on digital money. In view of such ideas, Edward Snowden’s opinion is entitled to have a strongly critical dimension.