The main catalyst for the transformation of traditional finance, bitcoin is now in the sights of most governments around the world. Several central banks are working to deploy their respective CBDCs which incorporate the characteristics specific to cryptocurrencies. Will BTC fall from its pedestal? Considering the growth of initiatives linking tokenized bank deposits, CBDCs and stablecoins, should we expect to see BTC tilt in the new economy?
War on bitcoin: the hidden objective behind the creation of CBDCs
Why are central banks scrambling to create their respective CBDCs if the digital version of the currency already exists?
Representatives of central banks and governments talk about financial inclusion, security, payment efficiency, lower transaction fees, etc.
The Biden-Harris report recently released by the Biden administration states that “CBDCs should promote equitable access to the financial system.”
However, anyone can guess the hidden motivation that supports the development of central bank digital currencies.
Indeed, with CBDCs, governments plan to regain control over money in all its forms and combat the hegemony of BTC.
CBDCs will allow them to control issuance and regulate the money supply according to their economic policies. With these centralized cryptocurrencies, BTC, which is shaking up the order, therefore has a major competitor.
Imagine for example wholesale CBDCs which function as bank reserves held by commercial banks at the Federal Reserve.
Imagine again the American Federal Reserve creating a crypto wallet. Americans will thus be able to use their retail CBDCs like traditional cryptocurrencies.
This would cause a total reconfiguration of the digital economy and a major blow to BTC. However, is this scenario really realistic?
BTC remains essential on the digital currency scene
With the meteoric rise in its price over the previous decade, bitcoin has continued to confirm its status as a store of value. This decentralized currency, which offers a significant level of anonymity, now brings together several million users around the world.
Unlike bitcoin, CBDCs offer governments exclusive control over citizens’ bank accounts. The latter will thus be able to censor any transaction at will. Retail CBDCs will also remove the financial intermediaries of commercial banks.
Governments thus become lenders instead of commercial banks. For businesses and civil servants, this is not necessarily good news.
The public and investors therefore have sufficient arguments against CBDCs which cannot therefore supplant the bitcoin market. Moreover, with the recent insurrection by American legislators, the American CBDC is not close to seeing the light of day.
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