Are we entering the era of CBDCs?

[Hamphser]

Yes, we are entering in a new era of CBDC. And I want to take it positively. If the central bank issue digital currency then we can reduce using stable coins. Its because likely most exchanges will accept that digital currency and it will be easier for us to convert our crypto to native digital currency issued by Central Bank. I think slowly every central bank will move toward CBDC.

Would it be just the same when you are just simply converting  your crypto into fiat? Well, of course once you do make out some conversion from crypto to CBCD's which is likely for platforms to adopt or integrate on

then alone would signify that you wont really be worrying about legal aspects which you would really be that in concern whenever you do get yourself in attach with crypto.

We might not really be seeing to be as rampant as it  should be but we are really seeing small steps which might really become more common in the future.

[justdimin]

Maybe other countries have started to enter the era of CBDCs.
But if you're in Asia, maybe you haven't or there are still many other considerations.
Everything also depends on the holding of the central bank or the head of the paper bank because it is all also involved in the crypto world Of course there are risks too.

I am pretty sure that everyone is just "research" phase right now, there aren't that many places that actually do take that time and build something that easily. I get that it may not be something that comes out right away, and I feel like it is going to take a while before we could move to a place where it is common knowledge and something we all use. CBDC is just an "idea" right now and ideas are dime a dozen and mean nothing.

If one person came to you and told you "I have a brilliant idea for a business" and offered you 50% ownership for all your money, would you really give that money? You wouldn't would you, which means government just has an idea, all of them, and it means nothing for now.

[uchegod-21]

This is the era of CBDCs.
But does CBDC bring anything new or good to the table?
Definitely no!
The same centralization and stability. Infact there are decentralized stable coins which are great substitute to cenrralized USDT and Binance stable coin for those who care about privacy.

Being rooted in reasoning about CBDCs, government cannot come to the crypto world, steal the blockchain technology for their CBDCs and then continue to fight btc. If they started using blockchain, that means they seek for a level ground to make their fiat coexist with cryptocurrencies.

China Yua CBDC success is not surprising because China is a country that is first organised, second accepts challenges and plan for greater nation and thirdly is populated.
Unlike my country who launched e-naira and there is no effect of it in the economy.

[Wexnident]

I think it's only China so far that's made developments this far? The rest that were interested in it are still only on the R&D process of things, and it's not odd really, China was one of the first countries, if not the one,  to actually start looking up to making their own CBDC. After all, it fits to a T to the way the government wants it to work.

From what I looked up China seems to have tested the use of their cbdc on the winter olympics(this last february). Even though it seems like it was only locally tested (foreigners weren't allowed from what I know), it seemed to be a success.

[Wimex]

Not only China adds to this, I was recently reading an article about CBDCs, but in this case European. The European Central Bank is conducting research to implement a retail digital currency, it is interesting because even a member of the Executive Committee of the Central Bank, Fabio Pantea, comments that it is

"likely to become a necessity"

Research on the complex potential interactions between CBDCs and monetary policy is left much to the speculation of what may or may not happen, as words like "financial stability" and "payment efficiency" are alluring, but falling into a BTC ban, it ceases to.

SOURCE: https://cointelegraph.com/news/ecb-executive-board-member-talks-about-current-state-of-digital-euro-cbdc-research

[pooya87]

Petro though was a complete scam, if I'm not mistaken, it was supposedly back up by oil and by the Russian, however, they debunked it already and all the money that was raised was nowhere to be found. So this is a case of CBCD failure in my opinion. And maybe other countries that follow learn by Maduro's mistakes that's why countries like China (Digital Yuan) can be considered as success because they are very careful on their decision to roll out. There was a time that they just roll it out to some small provinces in China just to test the viability of it.

Although there were a lot of fake propaganda about Petro but it was more like an ICO rather than a digital currency and Venezuela used it to mainly raise money which is probably why it would be considered a failure.

On the other hand, I am afraid it will lead to unprecedented surveillance and censorship, with no benefit at all to us, common people.

Isn't it already happening each time you use a centralized service (credit cards, debit cards, bank transfer, PayPal, SWIFT, VISA,...) to make a payment? I wouldn't say "more" censorship and surveillance, it would be pretty much the same as before.

I don't have a very good opinion of stablecoins, but I'm not too thrilled to replace them with CBDC - because the question is which is less evil than the two, shady private companies or corrupt governments and their centralized anti-private digital fiat. I agree that this would simplify the matter, but at what cost when it comes to privacy?

The way I see it is that people don't have or care about privacy already. Majority of trades are taking place on centralized exchanges that have already enforced KYC. Majority of purchases using fiat is done through the same CEXes using banks and again a lot of KYC. Using CBDCs isn't changing anything about their privacy but will provide them with a lot of security because they no longer worry about when FBI is going to raid Bitfinex headquarters and shut down Tether.

I think it's only China so far that's made developments this far?

Chin is just ahead, there are other countries that were serious about it but the news was swept under the rug for some reason. For example Russia claimed they have finished research and testing and will release the working solution in 2022. Iran also announced the CryptoRial is ready for launch soon.
It is interesting to know that all 3 are are members of Shanghai Cooperation Organisation (SCO) and have been moving away from using USD.

[DapanasFruit]

Yes, there is no doubt we are now entering the era of CBDCs with the successful launch in China and soon we can see other countries to also have their own version of it and some more now in the planning stage. But this nothing to be afraid of as CBDCs are just actually digitalized version of countries' fiat monies with some touch of technology...their own version of the blockchain technology under a very centralized setting where control is definitely a lot, way better than the original fiat money. I don't think this will be competing directly with cryptos...but can even enhance the people's interest with cryptocurrency and maybe there can come a time when cryptos and CBDCs can be seamlessly integrated by many platforms. Certainly, am sure PayPal can be integrating the two, who knows?

[NeuroticFish]

On the other hand, I am afraid it will lead to unprecedented surveillance and censorship, with no benefit at all to us, common people.

Isn't it already happening each time you use a centralized service (credit cards, debit cards, bank transfer, PayPal, SWIFT, VISA,...) to make a payment? I wouldn't say "more" censorship and surveillance, it would be pretty much the same as before.

Imho it's not the same. Now the eggs are not all in one basket, now one may need a warrant, there's some inertia.. it takes time...
When CBDCs will "rule the world" all such info will be in one place, to be centralized, checked, allow this or that entity just "help themselves" with all that data... and (as a different topic, but it now occurred to me) I don't even want to think what'll happen in the first hack (because .. you don't expect a government infrastructure to be as solid as the one of companies that literally depend on it, do you?)

[Lucius]

The way I see it is that people don't have or care about privacy already. Majority of trades are taking place on centralized exchanges that have already enforced KYC. Majority of purchases using fiat is done through the same CEXes using banks and again a lot of KYC. Using CBDCs isn't changing anything about their privacy but will provide them with a lot of security because they no longer worry about when FBI is going to raid Bitfinex headquarters and shut down Tether.

I absolutely agree that the average person cares very little about their financial privacy because they think that the authorities know everything anyway and that there is nothing to hide. Therefore, most people don't care whether they use stable coins or CBDC, it is important that the transaction is fast and cheap. As I already wrote, if you have to choose between two evils, it is logical to choose the one that has more legitimacy, and the CBDC of a stable country is probably less evil (risk) than some company that prints tokens as needed without being backed with anything.

Speaking of USDT, some speculate that they have already bought their own state (El Salvador), so I would not be surprised if they move their headquarters in that direction

[pooya87]

Imho it's not the same. Now the eggs are not all in one basket, now one may need a warrant, there's some inertia.. it takes time...
When CBDCs will "rule the world" all such info will be in one place, to be centralized, checked, allow this or that entity just "help themselves" with all that data... and (as a different topic, but it now occurred to me) I don't even want to think what'll happen in the first hack (because .. you don't expect a government infrastructure to be as solid as the one of companies that literally depend on it, do you?)

lol good point about the hack, I didn't even think about that. We've already seen too many of them in all corners of the world that crippled something that was centralized! That has me very curious about what have each of these banks done to mitigate such attacks. Unfortunately there aren't any technical details about their systems, it looks to be completely closed source!

[Abiky]

Surprisingly enough the Chinese altcoin (digital yuan) seems to be doing fine as they reported a little less than $10 billion worth of transactions recorded on their chain (if we can call it a chain!). There are also at least 2 new ones coming out in the coming months.

Suddenly it seems like the central banks jumped on board of the Bitcoin train but only took the blockchain technology and ran away.

I personally don't care how many of them are created as long as they don't try to ban bitcoin or restrict its adoption in any way (like closing bank accounts of those who dump fiat for bitcoin).
There may even be some silver lining that these CBDCs could replace the stable-coins in the market in the near future and we end up even seeing Atomic Swap capabilities added where you could easily swap one CBDC for another or for bitcoin without the risk of centralized stablecoins (issued by shady companies). That would definitely simplify things for traders while significantly reducing the risks they take.

I think we're still too early to tell, as crypto/Blockchain tech has a lot of things to improve in order to become widely adopted by the masses. There are issues/flaws to be discovered for CBDCs to be as robust and reliable as possible. That is if governments decide to use Blockchain tech for the new digital Fiat system. China may have been the first country to launch a CBDC, but it's still has a lot to catch up before it can become the world's leading economy (if it ever will). People just aren't ready for a fully-digitized world.

Apart from the fact that development of a CBDC will take years, getting everyone to adopt the new digital Fiat system will be quite a challenge. We already have stablecoins, so there's no rush in seeing CBDCs become a reality soon. As long as decentralized cryptocurrencies exist, nothing else matters. Just my opinion

[Xal0lex]

There may even be some silver lining that these CBDCs could replace the stable-coins in the market in the near future and we end up even seeing Atomic Swap capabilities added where you could easily swap one CBDC for another or for bitcoin without the risk of centralized stablecoins (issued by shady companies). That would definitely simplify things for traders while significantly reducing the risks they take.

All this would be fine if governments did not go the way of China, after launching their own CBDCs to monopolize the digital payments market. There is no telling how the digital yuan would have evolved or what popularity it would have had if China had not chased all miners out of the country and banned all cryptocurrency activities. The Chinese were taken away from their right to choose whether to use bitcoin or to use centralized CBDC. I really hope that there will not be such cases in the world practice anymore and CBDC will complement the crypto industry, not eradicate it.

[pooya87]

We already have stablecoins, so there's no rush in seeing CBDCs become a reality soon. As long as decentralized cryptocurrencies exist, nothing else matters. Just my opinion

Well all stablecoins are centralized so it matters a lot if we get a more trustworthy alternative

China had not chased all miners out of the country and banned all cryptocurrency activities.

China banned mining but only chased away big mining farms not all miners from the country.
Additionally China has never banned bitcoin or its usage and from other cryptocurrencies as far as I know they have only banned ICOs, and rightly so.

[worle1bm]

They have been in race to develop their own CDBC just to digitalized the payment system but the problem remains the same of being under their control and blockchain technology has not been fully explored by their experts.They are thinking it can hinder the growth of btc and other coins in one way but it can't and for me it's similar to making any tokens with centralised control.

[someone703]

Well, it seems some people have some special information to see the CBDC era coming. I see recent news about national governments focusing on blockchain research as well as implementing financial plans related to CBDC, but I still see some issues facing strong opposition and strong interest from a number of countries' commercial banks, but the opposite attitude of central banks, growing interest in CBDCs, and hoping the ongoing moves will make the future of CBDCs clear and have a good impact on the market as well as the current economy.

[Willamina Vernice]

Blockchain technology is expected to develop as a relatively mature technology. When a country uses blockchain technology, it may boost its economic development.
Digital currency will be the trend. It is more convenient and faster than paper money. But nothing is perfect. It also has many advantages: there are still many places without IoT. Digital currencies are also at risk of being stolen.
Now various countries are developing digital currencies. Digital currencies have gone mainstream.

[fullhdpixel]

The problem is that most countries looked at the technology as a joke and had some small research done and decided not to move ahead with creating a CBDC. Some others decided to let others be pioneers and see if it fails for them then jump on board.
Lets not forget that Venezuela created their Petro and it didn't take off. That may have changed some decisions in other countries.

China seems to pulled it off even though they arent actually using blockchain. Maybe those countries should start seeing blockchain differently. I am more inclined towards a new system as long it can be useful and not being used on launder. Anyway, those waiting for it to be succesful before doing it could actually realize it when its too late already.

There is nothing too late about it. If a country don’t want it now, they can decide it’s not yet time for them to get into such just because it is a trend. Most important thing that they have to do is just make sure that when they finally want to do it, that they are doing it in the right way. So far some countries that have released their own CBDC hasn’t been successful with it, not many people are really interested in making use of it.

The CBDC is just like you’re still making use of your online banking except that this time you’re now making use of a currency that is issued to you directly from the central bank.

[buwaytress]

Entering yes, if you think CBDCs are something new, but they're really not. Every country almost I've ever spent money in already has some form of national fiat that's stored or recorded electronically. You use a banking system over the telephone or internet, and it's got to be digitalized somewhere. I mean, none of this is even physically backed by anything, that's as virtual as it gets.

As people have pointed out above, all that initial fuss about CBDC is really not the hurrah we thought it was for Bitcoin because most of them aren't even blockchain-based, those that are won't be public blockchains. It'll just be a ledger the government can truly keep track of and monitor, is all. My thoughts anyway.

[pooya87]

There is nothing too late about it.

I have to disagree here because it depends on the purpose of the CBDC. For domestic use, you are right it will never be too late. But if it is aiming for international use (which I have a feeling the pioneers are) it is a race of who can create it first and get others onboard to use it.
The same China that has been taking over the world economy is leading this too. With the ongoing trend of dumping US dollar as reserve currency a void is being created that unfortunately China seems to be trying to fill.

[Emitdama]

With the help of centralized exchanges there can be the possibility of easy swapping of CBDC and Bitcoin like you have pointed out, yes it is possible for that to be done. But, are you ready for the centralised market in years to come?

A lot of things might change and the government can decide on anything, the only you will be safe from government’s regulation is by making use of decentralized/peer-to-peer exchange, although that doesn’t seem much safe anymore as centralized wallets would require every information about transactions going from their platform to an unregistered address. So, if you’re not giving out your information, someone else is doing for you. So, watch carefully.