Can bitcoin compete with CBDC's?

[LFC_Bitcoin]

CBDC’s are effectively just a stablecoin with spyware. Your government will use a CBDC to control you, to spy on you. Everything you spend will be monitored, every single cent of income will be visible and open to taxation. The very thought of a CBDC is evil. It’s intrusive, I don’t like it at all.

Of course bitcoin can compete with any potential CBDC. Bitcoin is the exact opposite of a CBDC. Bitcoin is decentralised, it has a capped supply of 21 million. The fiat value of bitcoin is designed to go up forever. Your CBDC has none of these features.

[Bitstar_coin]

Bitcoin and CBDCs have different properties and characteristics, and they are designed to serve different purposes. Btc is a decentralized, digital currency that is not controlled by any government or institution.

CBDCs, on the other hand, are digital versions of fiat currencies that are issued and controlled by central banks and the government. They are intended to complement, rather than replace, physical cash and bank deposits.

Btc and CBDCs are different, they are not mutually exclusive and they can coexist. So there is no need to compete with each other.

[uneng]

With the current state of market trust what will incentivize the average person to use bitcoin over a CBDC?

You know CBDC is the same thing of fiat, but in digital format, right?

CBDCs aren't a plus for governments and traditional banks against Bitcoin and decentralized crypto in general. The incentive to use Bitcoin is still the same: have control over your own money, transact it boardless anonymously, protect your patrimony on long term against inflation and potential government's seizure, accessibility when working and being paid online.

Since banks can control supply they can use inflation and other mechanisms to encourage spending. Bitcoin on the other hand requires additional layers to handle even the current network traffic and lacks incentive for day to day transaction use.

This is nothing new. Since the launchment of BTC in 2009 we hear these arguments, and they didn't prevent Bitcoin from being successful and hiting new ATHs every few years.

[The Cryptovator]

CBDC is only a digital form of fiat, nothing else. There won't be a change in the currency. It must be balanced by government wealth created through fiat. As a result, Bitcoin won't be threatened or compete with CBDC. Both are entirely separate things. Additionally, CBDC would support Bitcoin by making p2p trading simple. Instead, I don't sense any concern about CBDC. I will welcome it.

[BitcoinPanther]

Bitcoin and CBDC are two different kind of digital assets, so I think they are not directly competing with each other.  Bitcoin being decentralized cryptocurrency often use as an alternative to traditional fiat and store of value while CBDC as a digital version of a country's fiat is seen as a way for central banks to modernize their monetary systems and increase financial inclusion.

As you can see they have different purposes and target different user groups. However, there are a few areas where they could potentially overlap:

As a store of value: Bitcoin is often seen as a digital store of value, similar to gold. CBDCs, especially those with a limited supply, might also serve as a store of value for citizens, especially in countries with high inflation.

As a medium of exchange: Bitcoin can be used as a medium of exchange for goods and services, but its volatility and lack of widespread acceptance make it a less practical option than fiat currencies. CBDCs, on the other hand, have the potential to be more widely accepted and used as a medium of exchange, especially if they are backed by the government.

As a speculative asset: Bitcoin is highly speculative in nature and its value is highly volatile. CBDCs, being issued and backed by the central bank, may not have the same level of volatility as Bitcoin.

Average person may choose CBDC over Bitcoin because it is issued and backed by a central bank but other people might choose Bitcoin over CBDC because of the following reasons:

Decentralization: Bitcoin is decentralized, meaning that it is not controlled by any government or institution. This can be seen as an advantage by some people who value the autonomy and freedom that comes with using a decentralized currency.

Privacy: Bitcoin transactions are recorded on a public blockchain, but the identity of the users is not revealed. A CBDC, on the other hand, could potentially be used to track financial transactions and monitor the activities of its users.

Borderless: Bitcoin can be used globally, and it is not subject to the same regulations and restrictions as traditional fiat currencies. This can make it an attractive option for people who frequently travel or do business internationally.

Store of value: Bitcoin is seen by some as a store of value, similar to gold, and its value can be highly volatile. This can make it an attractive option for some people who are looking to invest or speculate on the value of a digital asset.

[el kaka22]

It can, it really really can. It's not going to be even similar, it will be something vastly different and people will react to it very differently. I know that people are not entirely sure about what to do when CBDC starts, and how the world will react to it, but we need to realize what it is and why it can't compete.

Why are we in bitcoin and not putting our money in fiat right now? Well, because we believe that bitcoin is better than holding it in fiat. What is CBDC? It's digital fiat, basically the same as fiat, but digital instead of paper. So that means why would people who moved away from fiat to go to bitcoin suddenly want to go to digital fiat instead? Makes no sense.

[evichi]

Bitcoin is built such that you have complete control of your funds. The philosophy behind Bitcoin is to "Be your own bank" because you are holding the keys to your wallet. CBDC is just the opposite because a third party is now involved in holding your funds. The bank is the third party; Government and Banks work hand in hand. They decide how you use your funds and the amount to use, your funds can even be frozen or denied withdrawal if there is an issue in your document or other issues, so you are not in control of your funds. Simply put, I think CBDC are digital version of fiat, so they are very much controlled by the Government. You are also exposed to inflation and other anomalies that may be present in such country. Basically, Bitcoin have a different philosophy when compared to CBDC. 

[posi]

Bitcoin and CBDCs have different properties and characteristics, and they are designed to serve different purposes. Btc is a decentralized, digital currency that is not controlled by any government or institution.

CBDCs, on the other hand, are digital versions of fiat currencies that are issued and controlled by central banks and the government. They are intended to complement, rather than replace, physical cash and bank deposits.

Btc and CBDCs are different, they are not mutually exclusive and they can coexist. So there is no need to compete with each other.

That's right, CBDC is just fiat in digital form, Fiat does not compete with bitcoin, so there is no reason to infer that CBDC and bitcoin are competing with each other. I think the purpose of the government creating CBDC is because we are moving into the digital age and everything is moving towards digitization, and using CBDC, the government will control us even better. So I don't think CBDC will compete with bitcoin, the two will go hand in hand to support each other.

[Wexnident]

Does it even need to in the first place? It'll get used if people want to use it, it won't if they don't want to, simple as that. Just the fact that Bitcoin is decentralized and CBDC is centralized already negates any sort of possible competition between the two imo, and CBDC is literally just fiat but digital (which fiat can honestly do as well). Let them do their thing, not exactly sure what CBDC's goal is (afaik it's just to digitalize fiat payments), but I'm pretty sure it's not anywhere close to wanting to fight with Bitcoin, or any crypto for that matter.

[yazher]

With the current state of market trust what will incentivize the average person to use bitcoin over a CBDC?

Since banks can control supply they can use inflation and other mechanisms to encourage spending. Bitcoin on the other hand requires additional layers to handle even the current network traffic and lacks incentive for day to day transaction use.

It's the same with the current fiat where they only make it digital and of course, the banks have control over your money once again. they just put some sugar coating with it but in reality, they wanted to fool people to use support their CBDC instead of bitcoins. From now on, we expect tight competition between these two and there will be lots of negative news against bitcoin again due to the fact they wanted to turn off the light of the future of Bitcoin as the mean of payment.

[Blitzboy]

I don't think so. People are losing their faith in the government, especially people in the USA. In my country, it is hard to find someone who fully supports the government and its centralized system. The current monetary system has existed for many years and flaws have been found everywhere. Suspicious transactions, centralization, printing, manipulating, inflation, etc have made many people tired of it. If you ask people on this forum, most of the people will choose bitcoin over cbdc because of the freedom and decentralization

So, IMO, CBDC will not stop bitcoin, it only make cryptocurrency become even famous

[zasad@]

With the current state of market trust what will incentivize the average person to use bitcoin over a CBDC?

Since banks can control supply they can use inflation and other mechanisms to encourage spending. Bitcoin on the other hand requires additional layers to handle even the current network traffic and lacks incentive for day to day transaction use.

The emergence of CBDC will not stop people from using bitcoin, this is because CBDC as we all know is no different from our traditional fiat currency, the only difference is that CBDC is the digitalized form of it,
- CBDC is still prone to centralized control like it is with our normal physical fiat currency
- CBDC is still prone to inflation, which can lead to loss of purchasing power, like it currently is with our physical fiat currency.
- CBDC can be frozen right there in your wallet by the Federal government or central banks they controls it, without your consent or permission, like it is with our physical fiat currency.
- with CBDC, your every transaction is monitored, you have no financial privacy of any kind because at all time, the central bank know how much you have in your wallet.
- with CBDC, when you send money to other parties, your identity is known to the central Banks, and so is the identity of whom ever you send money to.
- with CBDC, you can be denied access to your money any time and day, and there is nothing you can do about it if they refuse to grant you access to your money, who are you going to report to?.

But Bitcoin, Is the direct opposite of all that CBDC represent and stand for,
- Decentralized is bitcoin,
- Freedom is bitcoin,
- Privacy is bitcoin..

What more can one possibly ask for? Bitcoin has provided us with all that we need to live our lives free from other people controlling our finances lives, the ball is now in your court to either accept or reject.

Very good words, but if you read a little analytics and see what people and large banks made it so that bitcoin was traded on all major world exchanges and became very famous, it becomes clear that the same people are trying to participate in the launch of CBDC. Given the necessary situation in the world, these people can very quickly ban bitcoin mining and ban it on all exchanges. So far, such a situation has not occurred, but this scenario is possible.

[tvplus006]

With the current state of market trust what will incentivize the average person to use bitcoin over a CBDC?..

Since CBDC is one of the forms of money, it will be in circulation on a par with cash and non-cash types of money. And you will be forced to use it, since you will not be able to make calculations in bitcoin everywhere. In this case, such competition will not have any significant size.

[aidoyoh]

I guess a better question to ask is could bitcoin ever replace CBDC's? (bitcoin outcompetes CBDC's)

[Wiwo]

Just having Bitcoin as an alternative is cool for most of us, and bitcoin and CBDC are both two separate networks of financial transaction and asset management, Bitcoin have multiple features that are absent in CBDC and with that BTC vs CBDC is no equal and among the many differences is:
-Bitcoin is a decentralized currency with its own blockchain free from alterations from any part such that is evident in altcoins.
-Bitcoin serves as a trans border currency! Bitcoin is also an Asset were CBDC is just a currency peg to a fiat so ultimately CBDC is a centralized altcoin.

[sana54210]

It's the same with the current fiat where they only make it digital and of course, the banks have control over your money once again. they just put some sugar coating with it but in reality, they wanted to fool people to use support their CBDC instead of bitcoins. From now on, we expect tight competition between these two and there will be lots of negative news against bitcoin again due to the fact they wanted to turn off the light of the future of Bitcoin as the mean of payment.

Government will always have control over money. Even if we are talking about crypto, they won't have direct control of crypto itself, but they would have the control over fiat which we usually turn that into. Meaning, if you have bitcoin and it goes up and you are richer now, they still control what you can do as a rich person, because they are the ones deciding the law.

This is why CBDC doesn't matter, because we are already at a place where governments have some control over it and Bitcoin is still awesome and still better than anything and we will still keep using that. There is no fear of CBDC at all, that will not change anything in crypto world, maybe stablecoins should be worried a bit, not us.

[nakamura12]

It doesn't matter of what kind of currency it is either in digital form or not it is still the same as it is regulated by the government unlike with Bitcoin where no one regulated the Bitcoin. Bitcoin can compete with cbdc as it cannot stop people from using Bitcoin. Both have different purpose or goal to achieve. As I have explained that CBDC is regulated by rhe government since it is pegged by the fiat currency or in short it's digital form while Bitcoin is all about being decentralized and also let people decide to be anonymous or not.

[Ozero]

It's actually opposite as government are trying to compete with Bitcoin through introducing these CDBC and giving people digital payment access but it's the same like any other digital payment but the only thing they add on is Blockchain technology but if you say about competing with btc then there's no chance at all as we are comparing centralised token with decentralised coin so what do you think about it?

It can hardly be said that governments are trying to compete with bitcoin, and therefore issue their own CBDCs. By issuing CBDCs, governments are simply improving the efficiency of their banking system's cashless payments. They have long appreciated the benefits of blockchain technology, and therefore use it to improve the performance of their national currencies.
As for the possible competition between CBDC and Bitcoin, of course, they cannot compete as they are completely different financial assets. The competition between them is the same as between fiat and cryptocurrency in general.

[rhomelmabini]

I guess a better question to ask is could bitcoin ever replace CBDC's? (bitcoin outcompetes CBDC's)

Same thing OP, you won't be able to compare or make some replacements since these two aren't the same at all when it comes to what they aim. I don't think these huge bankers will ever make it so easy for Bitcoin to replace their God (fiat). I don't think Bitcoin will compete with it, they're probably goes hand in hand to exist.

[danherbias07]

Wrong comparison. CBDC should be compared with money transfer applications or fiat wallet services and not against Bitcoin.
Bitcoin paired with Ethereum, that is when a big question will come out on which is better between the two. Or BNB.
No competition between CBDC and Bitcoin because Bitcoin is not defined by most users as a currency yet, it's an asset and they will keep it as long as they want just like how my Mama keeps her gold in her stash.
And I doubt CBDC will be supported in a sweep, when people realized what they are up to, there will be doubts about why they should use it rather than just using plain cash.