Central bank digital currencies, or CBDCs, are often presented as the essential future of finance. Yet, despite their promise of modernization and increased efficiency, these currencies raise deep concerns about their true utility and impact on individual freedom.
The broken promise of transparency
Transparency is commonly cited as one of the main benefits of CBDCs. In theory, opening the source code of CBDC projects to public inspection should increase citizen trust (much like crypto). However, experience shows that transparency alone is insufficient to guarantee the ethics and fairness of financial systems.
Take the example of Brazil, where the rapid discovery of surveillance mechanisms integrated into coded of the CBDC reveals a potential abuse of power. Despite the publication of the code, the inherent centralization of CBDCs places control firmly in the hands of the authorities, leaving little room for genuine citizen intervention. This recalls the interest in bitcoin and some cryptocurrencies.
The centralized nature of CBDCs is a major concern. Unlike decentralized cryptocurrencies like Bitcoin, where users have direct control over the network and can influence its development, CBDCs remain under the strict control of central banks.
Even with open code, users have no real ability to modify or fork the network if they disagree with the direction being taken.
This is illustrated by the case of Norway, where despite an initial open project, no guarantee secures the future of this openness. Thus, power remains centralized, and the promise of democratic participation quickly dissolves in the face of the reality of unilateral decisions by institutions.
Transparency without power of CBDCs
The final nail in the coffin of CBDCs’ purported effectiveness in terms of transparency is the illusion of control it creates.
In the United States, for example, the Hamilton Project was indeed an open collaboration, but there is no indication that the results will influence Federal Reserve policies in the long term.
Transparency, without the power to act on the information disclosed, is superficial. Citizens can see the flaws and problems, but without real pressure, this openness only exposes the flaws without offering solutions.
CBDCs represent a significant technological advancement, but their implementation raises serious doubts about their ability to truly serve the public interest.
Their centralized nature and the inherent limitations of transparency as a tool of democratic control call into question their role in a society that values individual freedom and citizen participation.
For digital currencies to meet the needs of the people, they must offer more than just transparency; they must guarantee a real capacity for action and control in the hands of all citizens. In the absence of this skill, CBDCs risk becoming another tool of centralized power, far removed from the ideals of freedom and transparency that they claim to embody. Meanwhile, North Korea plans to embrace BRICS.
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