What do people think about CBDC?

[Aletheaminlin]

As noted by the OMFIF report the main activities to pursue a large-scale CBDC, closely followed by the answer, lie in improving speed and cost effectiveness. It can also help overcome existing system limitations, especially in terms of system security and resilience. A large scale CBDC can reduce operational risks and operating costs due to capacity building as multiple major assets become tokenized and recorded on scatter boards.

I wonder if a lot of people are interested in it here? But now I am seeing a lot of the central banks of the countries announcing that they will develop CBDC in the near future. Now, personally, I think the leader in this field is China, could this be another race on the cypto front between the USA and China.

Show me your view on a possible upcoming trend.....

[Charles-Tim]

There are this topic related threads, CBDC will just be a new era means governments will deprive people of privacy because non will be a privacy coin, they will all be centralized fiat-pegged digital currencies that is controlled by the governments which can even likely be less private than the non-private fiats which will result to privacy completely lost in the world for people that will make use of the CBDC. But, it will be an effective means if collecting taxes from CBDC users and a way fiat is introduced into digital form in another means.

[davis196]

The forum members keep discussing CBDC for more than 2 years and yet there's not a single CBDC launched in the past months.CBDC will remain as a concept/idea/theory,if you ask me.
It is more worth discussing CBDC after at least one central bank digital currency gets introduced to the world.
This topic is similar to the quantum computer discussion.Every now and then I see forum members posting questions about "What will happen to the blockchain,after quantum computers become a thing?".
We can play mind games and fantasize about the future,but there aren't any CBDCs or quantum computers coming anytime soon.

[Lorence.xD]

The forum members keep discussing CBDC for more than 2 years and yet there's not a single CBDC launched in the past months.CBDC will remain as a concept/idea/theory,if you ask me.
It is more worth discussing CBDC after at least one central bank digital currency gets introduced to the world.
This topic is similar to the quantum computer discussion.Every now and then I see forum members posting questions about "What will happen to the blockchain,after quantum computers become a thing?".
We can play mind games and fantasize about the future,but there aren't any CBDCs or quantum computers coming anytime soon.

The reason that it will stay that way is because the government does not put any effort into making it an effective means for the people to use. China did introduce a CBDC in their country but it became a flop because people did not see the benefit of using it and the government did not care to do so. Quantum computers are a thing now, they are already developed and the only problem is that they are mostly used for experimental levels and a commercial use is still far from ever happening.

[LeGaulois]

@Aletheaminlin

Central banks are thinking about their own digital currency and on another side, there are a couple of governments thinking too to make their own digital currency. Imagine in the future, we will have for example EUR as we know it, the digital version of EUR, and a national version (let's call it a countrycoin). I can't imagine people able to use 3 different currencies but it remembers me of a post here from Hal Finey who told we will probably have different layers of digital currencies. The ones used by banks, the ones used by people (Bitcoin héhé), and the ones used by, why not central banks or INTL companies.

Nowadays his post makes sense to me. We are at the very beginning but in a decade from now I won't be surprised if the things happen as he was describing.

@Charles-Tim

CBDC will be controlled by central banks not the governments, hence the name Central Bank Digital Currency.
The goal is not to erase privacy, if people have a problem with it then they shouldn't use their bank card, chéque, bank transfer, and the whole banking system. In this case then only banknotes matter.
So the privacy regarding CBDC is a non-existing problem or rather I should say irrelevant.

Pegged to a national currency, yes, what's the problem? There are a few stable coins pegged to USD, yet there are millions of people using it
The tax excuse is an irrelevant problem too. Cryptocurrencies are also taxed, so what? Imagine Bitcoin is accepted everywhere, do you think for example you will avoid the VAT? Nope

@davis196

It does not happen overnight, it can easily take 5 years or more. It took 2 decades to launch the euro.

[Charles-Tim]

CBDC will be controlled by central banks not the governments, hence the name Central Bank Digital Currency.

In my country, the central bank governor is not contested for, it is not by vote, the president put the CBN governor on the seat, which means they are controlled by the governments not the banks because the governments controls the central bank while the central bank control all other banks under the country.

The goal is not to erase privacy

Agreed. But, it can not be as private as decentralized cryptocurrencies like bitcoin because I have my private key. The goal is not to erase privacy but the process will lead to privacy deprivation which can later erase privacy.

The tax excuse is an irrelevant problem too.

Governments use taxes for relevant national budgets that can result more to national development, I did not comment against it. After commenting how the coin could result to privacy deprivation, then I commented about how it can be an effective means of collecting taxes.

But , it will be an effective means if collecting taxes from CBDC users and a way fiat is introduced into digital form in another means.

[Lucius]

China has gone the furthest in that direction, and they have already done quite large tests with the local population on several occasions - from everything I have read the tests have been successful and there is great interest from Chinese citizens in this type of payment.

Moving closer than ever to nationwide launch, China’s DCEP e-RMB will soon circulate in the heartland city of Suzhou in the biggest test yet of the nation’s new central bank digital currency (CBDC).

About 100,000 residents of Suzhou, a manufacturing hub in eastern China, will receive free digital red packets containing a collective 20 million digital yuan — or about US$3 million — starting tomorrow. China’s latest digital currency giveaway, the largest to date, is scheduled to happen the day before the nation’s “double twelve” festival of shopping this Saturday, Dec.12.

I don't know if there is another country in this stage of development when it comes to the CBDC, but it seems that China could very easily be the first to launch something like this at the national level. We should not be surprised that this is happening, everything is going in the direction of digitalization and the time of money as we know it will undoubtedly come to an end. It is known that in Sweden about 98% of all payments are made digitally without cash, so cards that are already a generally accepted substitute for cash will be replaced with CBDC applications in our smartphones.

[Ozero]

There are this topic related threads, CBDC will just be a new era means governments will deprive people of privacy because non will be a privacy coin, they will all be centralized fiat-pegged digital currencies that is controlled by the governments which can even likely be less private than the non-private fiats which will result to privacy completely lost in the world for people that will make use of the CBDC. But, it will be an effective means if collecting taxes from CBDC users and a way fiat is introduced into digital form in another means.

A figure has long emerged that about 80 percent of all states intend to issue or are taking steps to issue their national digitized central bank currencies. This is very beneficial for states, therefore, in a decade, almost all states will have their own stable coins of central banks.
For people, their use will also be beneficial, since the speed, efficiency and convenience of using them will increase significantly.
As for confidentiality, it will be at the level of bank cards. People use them despite the fact that banks, and therefore governments, completely have their confidential data.

[Aletheaminlin]

L3 digital assets ?
I see them as having been discussing this issue very actively over the years. According to the CEO of a company developing on the above field.
link: https://twitter.com/skyguoCypherium/status/1353878334321680384

The @bankofengland
 governor agrees with me. Three layers of the future #blockchains:
L1 protocol coins
L2 stable coins
L3 digital assets

[Aletheaminlin]

@Aletheaminlin

Central banks are thinking about their own digital currency and on another side, there are a couple of governments thinking too to make their own digital currency. Imagine in the future, we will have for example EUR as we know it, the digital version of EUR, and a national version (let's call it a countrycoin). I can't imagine people able to use 3 different currencies but it remembers me of a post here from Hal Finey who told we will probably have different layers of digital currencies. The ones used by banks, the ones used by people (Bitcoin héhé), and the ones used by, why not central banks or INTL companies.

Nowadays his post makes sense to me. We are at the very beginning but in a decade from now I won't be surprised if the things happen as he was describing.

Well CBDC will be the inevitable trend, I don't know if you've heard of them being actively promoting it this year, the current amount of money is being traded mainly by banks, so I think we need more knowledge and information in this area.

[JoKleinTopper]

There are this topic related threads, CBDC will just be a new era means governments will deprive people of privacy because non will be a privacy coin, they will all be centralized fiat-pegged digital currencies that is controlled by the governments which can even likely be less private than the non-private fiats which will result to privacy completely lost in the world for people that will make use of the CBDC. But, it will be an effective means if collecting taxes from CBDC users and a way fiat is introduced into digital form in another means.

I once thought CBDC is a good thing for us coin holders, but a second thought came to me. I hate losing privacy or being supervised by others, esp. by the government!

[Yum Bravo]

China will lead the future of cbdc and currency competition. The Chinese government has prepared a plan to achieve it, while the US government has just escaped from the chaos and has to deal with COVID-19.

[bitgolden]

CBDC will be the inevitable trend, I don't know if you've heard of them being actively promoting it this year, the current amount of money is being traded mainly by banks, so I think we need more knowledge and information in this area.

Obviously it is going to be done by those huge banks, but we are talking about a cryptocurrency that is based on the coin itself, so if CBDC does it without the coin it will fail big time, it needs to have the represented amount in coins as well. I believe it is going to take some more time, it is not going to be like "look we created a CBDC, why don't you invest some?" and done with it, there needs to be a lot of hard work and preparation that goes into it, and if it does go into it properly and they do a great one, it is going to get picked up by many investors.

I do not agree that it is "inevitable" that it will happen, as long as there is none that makes sense for the investor, investors will keep staying away from that idea, why would I want to invest into CBDC if I can simply buy bitcoin and hold that? It means they need to find a reason and why it is better to invest to it before it will get more mainstream.

[dothebeats]

IMO, CBDCs are attempts from the central bank to make payments and transfers more seamless, given that it will run in a single infrastructure that is digitally interconnected, same as the banking networks that we have right now, ensuring that payments and funds transfers from point A to point B is secure. The idea comes from cryptocurrencies obviously, though with elements of traditional banking embedded within the protocol. China already made significant tests and moves on furthering their CBDCs IIRC on several articles that I've read, though it's never a question of who gets the right formula first but rather who gets the right formula to make it work. The Chinese citizens might want it given how 'easy' it is to use them on paper, though there are still a significant portion of the population whom will be left out if CBDCs are implemented in a hurry. Same goes to all countries that are going R&D on the use of CBDCs.

[Febo]

What do people think about CBDC?

CBDC will be stable coins. They will end Tether FUD, or maybe will just expand it since no one will trust governments. CBDC will somehow not be enough decentralised to matter. So not decentralised stable coin. Is this something that will be able to compete with Bitcoin and Monero?

[DooMAD]

Is this something that will be able to compete with Bitcoin and Monero?

They won't really be comparable.  I still think CBDCs won't even resemble a cryptocurrency in the sense we're accustomed to.  The infrastructure will be entirely different and I'm fairly certain they won't appeal to the same audience as crypto does.

People often give me the impression they think a CBDC will be something they can send to an exchange and use it to trade with like they do other coins.  I don't personally see that happening.  My suspicion is we'll see the shortcomings of a total lack of censorship resistance right away, when people discover their bank won't allow them to send payments to an exchange using such a platform. 

[huff87]

Advocates claim that because of the way CBDCs are structured under the hood, they could lead to lower costs for transferring money. The idea is that with a CBDC, financial entities are more connected, making a smoother way to move money around than the disjointed financial system that's in place today. The perimeters of central banks are gradually starting to be crossed by the rise of crypto-assets. Especially since the new COVID-19 crisis offers an opportunity for Fintechs to impose themselves given the containment measures and social distancing. The question is asked for central banks, on the adoption of a digital currency for central banks, in order to centralize the system and ensure the safeguard of money for public confidence.

[TimeTeller]

Advocates claim that because of the way CBDCs are structured under the hood, they could lead to lower costs for transferring money. The idea is that with a CBDC, financial entities are more connected, making a smoother way to move money around than the disjointed financial system that's in place today. The perimeters of central banks are gradually starting to be crossed by the rise of crypto-assets. Especially since the new COVID-19 crisis offers an opportunity for Fintechs to impose themselves given the containment measures and social distancing. The question is asked for central banks, on the adoption of a digital currency for central banks, in order to centralize the system and ensure the safeguard of money for public confidence.

If they can offer benefits to regular bank users, why not?
We have been aiming for the lower fees a long time already, especially cross-border transfer payments.
Even local transfer from one bank to different bank incurs certain amount of fee.
Maybe, with CBDCs, the fees will be much smaller, that will benefit a lot of bank users.

[maxreish]

They are always saying great things about CBDC to resolve problems and issues like securities and limitations. It is still in a conceptual stage. Banks are trying to reach out cryptocurrency by representing CBDC. While the platform indeed has a good objective of proposing regulated monetary authority, the situation is kinda not guarantee that it will going to be a smooth plan.

Will this CBDC be a threat to Central banks? As I can see what if majority moves their money to CBDC?

[worle1bm]

As noted by the OMFIF report the main activities to pursue a large-scale CBDC, closely followed by the answer, lie in improving speed and cost effectiveness. It can also help overcome existing system limitations, especially in terms of system security and resilience. A large scale CBDC can reduce operational risks and operating costs due to capacity building as multiple major assets become tokenized and recorded on scatter boards.

I wonder if a lot of people are interested in it here? But now I am seeing a lot of the central banks of the countries announcing that they will develop CBDC in the near future. Now, personally, I think the leader in this field is China, could this be another race on the cypto front between the USA and China.

Show me your view on a possible upcoming trend.....

The idea of CDBC has been around from past few years but still many countries are developing or say in are trial basis for making their own Centeral Bank Digital currency.A few ambitious countries, including China with its digital yuan and South Korea, have already finished a demo and are piloting the technology. But a CBDC has yet to be deployed on a large scale.They are using blockchain technology for its development and storing information on distributed ledger's which can be accessed by everyone but still most of people do not use it.

But the centeral banks have control over these digital assest because of DLT technology which is permissioned blockchain which is different from Bitcoin which is completely decentralize and these CDBC can give rights to some particular members to alter and modify the records which is why people have trust related issues over such currencies.
Moreover they can track your payment and have tighter control over its citizens as what the government really want it to be.

Venezuela was a pioneer in this respect, launching its own cryptocurrency, the petro, in 2018. However, the petro is plagued by problems and very few Venezuelans actually use it

So the idea is still in air and not possible for government as people will still prefer decentralised mode of payments like btc in future.