Privacy in crypto will become ever more important as governments start to roll out their central bank digital currencies or CDBC’s and some of them have launched their dystopian digital currencies already.
One of the first was Nigeria last October which launched its e Naira CDBC.
Now this is not surprising given that crypto interest and adoption seems to be higher there than in any other country and the government doesn’t want to lose control of its domestic money supply.
Nigeria’s central bank recently reported that the e-Naira had over 270 000 active wallets which sounds like a lot until you realize the wallet app has been downloaded over 840 000 times and the country itself has a population of over 200 million.
This suggests that the average Nigerian is not that eager to adopt their government’s currency but that isn’t stopping Nigeria’s central bank from pressing ahead with its CDBC. As to how it will convince the average nigerian to adopt it I suspect that it will have something to do with a crisis of some kind which will involve the dispersion of emergency funds.
Something that’s been discussed in many CDBC papers we’ve covered. Meanwhile across the pond the Colombian government has announced that it will be rolling out a CDBC to combat tax evasion. This is surprising given that tax evasion only accounts for eight percent of the country’s GDP which is certainly a lot but not nearly enough to justify the rollout of such an elaborate system.
Looking at the Colombian pesos value versus the US dollar presents what is likely the real reason the Colombian peso has been collapsing against the US dollar over the last decade and the government doesn’t want to lose its national currency to the US dollar or worse a cryptocurrency.
For anyone wondering whether this is some conspiracy well the European central bank recently said the quiet part out loud in a working paper about its upcoming digital Euro a CDBC is the only solution to the quote smooth continuation of the existing financial system which everyone hates by the one percent.
Of course who have done very nicely out of it at the expense of the rest of US. Finally we have the Federal Reserve which is not rushing to release a digital dollar for many reasons including the fact that dollars are still in very high demand and that centralized stable coins like circles USDC are de facto digital dollars.
A fed official recently added another reason not to rush a digital dollar and that’s the upcoming release of the fed now payment system which quote addresses.
The issues that some have raised about the need for a CDBC according to said fed official. The fed now payment system is scheduled for release in 2023.
So-called fast payment systems can act as CDBC’s if they’re paired with a digital ID. .