ETHAN HUFF
The International Monetary Fund (IMF) published a report recently that warns about the very serious privacy risks associated with central bank digital currencies (CBDCs).
According to the paper, entitled "Central Bank Digital Currency Data Use and Privacy Protection," any central bank can use its CBDC system to collect all sorts of private information about users. It could then turn that private information over to the authorities for mass surveillance and possibly persecution reasons.
"CBDC data allows for commercial exploitation while also raising the possibility of state surveillance," the IMF warns.
The way CBDCs work is that every time a transaction is made, all sorts of private information is transferred and uploaded into the blockchain as proof. That information is then open game for government authorities and anyone else to exploit it for ulterior purposes.
"Central bank digital currency (CBDC), as a digital form of central bank money, may allow for a 'digital trail' - data - to be collected and stored," the paper explains.
"In contrast to cash, CBDC could be designed to potentially include a wealth of personal data, encapsulating transaction histories, user demographics, and behavioral patterns. Personal data could establish a link between counterparty identities and transactions."
The paper goes on to explain that there is economic value in CBDCs due to the data trail it creates. Data is considered an "infrastructural resource that can be used by an unlimited number of users and for an unlimited number of purposes as an input to produce goods and services."
"CBDC data could potentially be harvested by financial institutions that, in turn, could help develop data-driven businesses," the paper continues.
One of the greatest dangers that is not often talked about is it's programmable nature, meaning someone outside of your control will have the ability to turn it on and off, or program it in such a way that makes it applicable only at certain stores or for certain goods and services, not others. It's not just the monitoring of what is being bought and sold but the ability to control it on a mass scale almost instantly.
More than 98 percent of the world's central banks are preparing now to help unleash a new global cashless society once the time has come. All we need is one good economic disaster to push us over the edge and the general populace will be eager to sacrifice privacy for stability and convenience.
Should the general public have access to everyone's private spending habits?
What kind of data is collected when using a CBDC, you might be wondering? Besides the payer's and payee's names and identities, there is also transaction data for both payer and payee as well as metadata about the merchant's name, location, and spending category.
Credit card companies already collect and store this type of information about users and their transactions, but central banks are not privy to it unless they pursue it with a warrant. CBDCs, on the other hand, are an open book for the money masters to track every single purchase that every user makes.
Whatever the agenda of the central banks, CBDCs allow the money masters to collect and use data to achieve their policy objectives. Some of the use ideas presented in the IMF paper include:
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