Central Bank Digital Currencies: What you should know

Central Bank Digital Currencies are the linchpin for a much, much darker world.

What is a Central Bank Digital Currency and why should you care? Don’t most of us use digital payment systems daily already? And our money supply is already controlled by a central bank, so why not cut out physical currency entirely and save ourselves the environmental cost and trouble of the production and transportation of physical cash? Well… paid attention to China lately? More on that later.

Let’s start with the basics.

A Central Bank Digital Currency (CBDC) is similar to traditional cryptocurrencies in that they both operate off of a blockchain structure. Traditional cryptocurrencies, like Bitcoin, operate on a public blockchain that is held in innumerable systems around the world and updated each time a transaction takes place to reflect each instance of Bitcoin changing hands. Because there is a large network of ledgers all checking with one another for any discrepancies, it keeps the whole system honest. It is innovative in that it is — down to its essence and original purpose — meant to act as a system of payment that bypasses highly regulated and controlled fiat currencies to give the power of commerce back to the people and take its management out of the hands of a select few oligarchs. Thus far, however, due to their history of extreme price volatility, cryptocurrencies have largely been used as an investment instrument similar to more traditional company stocks exchanged through stock markets.

Opponents of decentralized cryptocurrencies often tend to harp on the extreme volatility of cryptocurrencies as a reason not to use them as an instrument of payment, as well as erroneously citing spurious fearmongering ‘studies’ put out by oligarchical power structures who benefit directly from operating institutions that create fiat currency that state that criminals such as drug dealers, human traffickers, etc. use cryptocurrency as payment instruments since crypto transactions are meant to be ‘anonymous’, which is patently false.

Cryptocurrency transactions can very much lead back to any criminal element who uses them unless they utilize what is called a ‘mixer’ service that mixes their dirty crypto with crypto never used in criminal enterprise so they effectively launder that money. The problem is that with large amounts the fees are staggering and it just isn’t worthwhile to try and launder crypto with the methods currently being used.

Simply put — cash is king in the underworld. That isn’t a reason to go to a CBDC as an alternative, though. Speaking of, what is the difference between traditional crypto and a CBDC?

CBDCs, unlike Bitcoin - which uses a public blockchain, are centralized on a private blockchain entirely controlled by the Central Bank of a given nation and thus are typically going to be beholden to oversight from the government of that nation. It will be presented as the same thing as the fiat currency we all use now, minus the issuance of physical cash, but that’s anything but the truth. Not only will physical currency — still the most private and final currency there is — be no more, but imagine a world where your money expires. That’s right — if you don’t spend it in a certain amount of time, or your social credit score drops too low, the state can dock you and prevent you from acquiring goods and services because you weren’t a model citizen. Sound fun yet?

Imagine also that, in the event of any sort of controversy involving you or your business, that the government decides they want to freeze your assets for a while. Think it can’t happen to you? You need only look at the Trucker Convoy protests in Canada and how Dictator Trudeau’s regime threatened the lives and livelihoods of entire families whose breadwinners decided to fight for their rights by freezing bank accounts so those families could no longer pay their bills.

With the government having a direct access line to your bank account in the case of CBDCs, they wouldn’t need to ask anyone, they’d just turn off your account until you make amends for whatever perceived infractions you committed to stoke their ire.

Think also of a world where a bank account can have a negative interest rate applied so that every bit of money you earn is subject to incremental depreciation, robbing you over time unless you spend that money. The IMF presented this as a solution to recession back in 2019. It isn’t quite the financial armageddon of expiring money, but it’s arguably just as destructive over time. The IMF also advocates for the eventual phasing out of cash entirely. So if you weren’t convinced the most powerful entities are onboard with this devastating blow to freedom as a whole before, then you should be now.

So imagine your money is subject to negative depreciation and possible overt expiration, you may as well just blow it all on booze and other vices, right? Not exactly. Enter the programmable currency aspects of CBDCs, where governments can impose limits on how much you can spend on certain things, such as alcohol and vice in general. I suppose in the case of addicts I can see the utility in that, but what if they also determine that they should protect you from yourself by limiting how much of your money you can use to invest in the stock market, for example? Investing in securities and assets ARE a popular means of beating inflation and the tax man long term, but they also act as untouchable bastions where the government cannot easily part you from those funds. I wholeheartedly believe that CBDCs would be programmed to curtail such methods of restricting their access to what is yours.

Mr. Bo Li - a Chinese National and IMF’s Deputy Managing director as of 2021, had this to say about programmable money:

“CBDC can allow government agencies and private sector players to program, to create smart contracts (programs stored on the blockchain that execute when predetermined conditions are met), to allow targeted policy functions. For example, welfare payment. For example, consumption coupon. For example, food stamps.”

"By programming [the] CBDC, those monies can be precisely targeted for what kind of people can own, and what kind of use [for which] this money can be utilized."

Naturally, they always use the most altruistic examples such as providing support to the less fortunate in order to try and pluck at the morality of citizens so that it’s easier to coerce them into adopting what amounts to a terrible deal with no real upside for the common person and no perceivable downsides for the moneychangers in control of the issuance of said centralized digital currencies.

But hey, maybe I’m wrong. Maybe governments around the world will see the error of their ways and not attempt to exercise limitless control over our lives anymore, and to do right by us. And if you believe that, I got some oceanfront property in Arizona to sell to you.

But seriously, I look at recent events and it’s hard to see anything but a precipitous slide into the ‘You will own nothing, and you will be happy’ Klaus Schwab wet dream that is a nightmare for the rest of us.

Think about the recent banking collapses, and subsequent consolidation of power and market share. Credit Suisse is now part of UBS, creating an even more bloated giant which will be in charge of over $5 trillion in risk capitalization. Meaning if all those assets went to $0, $5 trillion would cease to be. It’s an obvious statement to make but still, food for thought. Too big to fail indeed.

And speaking of ‘Too big to fail’, First Republic Bank received a $30 billion cash injection from a ‘Who’s Who’ list of massive banking entities, including but not limited to, JPMorgan Chase, Citigroup, and others who have pocketed taxpayer money in the past with no repercussions after making phenomenally stupid bets on an out of control housing market back in 2008.

Oh and speaking of pocketing taxpayer money, Silicon Valley Bank — the purple-haired social justice warrior bank of buffoons that started the latest cascade of trouble in the banking sector — received assistance from the Federal Deposit Insurance Corporation (FDIC), Federal Reserve, AND the Treasury Department.

Dementia-ridden President Joe Biden, meanwhile, stated that taxpayers would not be on the hook for this Silicon Valley Bank’s bailout.

"This is an important point—no losses will be borne by the taxpayers," Biden said in a speech on the matter. "Let me repeat that: No losses will be borne by the taxpayers."

His reasoning is that the money will come from the fees that banks pay into the FDIC for insurance on deposits. These remarks highlight his gross lack of understanding about the banking system — and capitalism in general.

Let’s say he’s right and that all the money to bail out SVB came from those fees paid into the FDIC as he said. To preface this, what happens when you have a car accident and your insurance has to pay? Your insurance rates go up. Won’t the fees that Silicon Valley Bank has to pay into the FDIC summarily have to increase as well? And what happens when companies have to delve deeper into their pockets to pay their bills? They pass those costs onto the consumer. Therefore, the people will have to shoulder the costs no matter what and Joe Biden is an idiot.

Furthermore, it’s fundamentally wrong to state that any money paid out by the Federal Government is not, strictly speaking, taxpayer money. The only way he’s truly correct is if the Federal Reserve — remember how they were also involved? — printed the money and handed it over to Silicon Valley Bank. Ah but it wasn’t them expressly, was it? It was the Treasury Department.

The Treasury Department’s main function is that they collect taxes, duties, and monies paid to, and due to, the U.S. as well as covering all of our country's bills. They also have a hand in determining exactly how much cash goes into the U.S. economy through the fractional reserve banking system.

I’m sure we’re all familiar with how that works, but for those that aren’t, here’s a quick breakdown:

The Treasury Department, finding themselves in need of additional funding for various reasons, calls up the Federal Reserve and requests, say, $1 billion. Well, naturally the Federal Reserve is all too happy to provide it in exchange for the equal value in Treasury bonds. Keep in mind, all bonds pay interest in exchange for holding them, because they’re essentially just an ‘IOU’. An IOU that we, the taxpayer, owe back to the Federal Reserve. With interest.

So if we go the route of just printing the money for the bailout, we inflate the currency even further because as you may or may not be aware, our money is backed only by the outstanding debt against it as that whole gold standard thing went away ages ago. Therefore, that newly printed cash derives its value from the rest of the cash supply, inflating the currency and applying a hidden tax to every single American by diluting the purchasing power of our money.

So once again Biden is wrong, and not only are we on the hook to bail out a massive bank, we’re doing so at a loss on all counts — as consumers and as taxpayers.

But this article was about Central Bank Digital Currencies (CBDCs), right? So why am I talking about collapsing banks, bailouts, and the fiat money system currently in place? Because the consolidation of power into fewer and fewer hands is at the very heart of just why CBDCs will be the offered solution in order to ensure that no one will ever have to be uncertain that their money is safe again. All it will require is handing over all your savings and rights to property and autonomy.

That may sound hyperbolic, but think about it: With the overwhelming push for people to conform to certain deranged ideologies and world views, is it really so hard to believe that those who would stand to benefit from a hivemind collective of drones robbed of all critical thought would go so far as to regulate your ability to buy and sell goods and services as a means of control?

Remember how I mentioned China earlier? They’re always the litmus test whereby any authoritarian measures are tested in order to gauge general public sentiment when being forced to embrace new restrictions on their lives. Remember Covid lockdowns and restrictions? China did it first. They also started the social credit system that threatens freedom on a global scale.

We’re all probably aware of the controversial social credit system in China, where people are given a ‘credit score’ that can go up or down based on how good a citizen they are. Doing things that are ‘good’ for society will give you additional points, and of course committing crimes or engaging in ‘problematic’ behavior can ding your credit score. And of course the risk of a falling social credit score is losing certain privileges, such as the right to own property, travel, or even send one’s children to certain schools.

This video also touches on the need for perfect facial recognition technology and shows why every selfie you take is used to improve this technology. They even devised ways to recognize people with face masks on, so hiding behind a mask will not prevent their systems from knowing who you are.

Instagram clout chasers have doomed us all.

Tying together a social credit system with a digital currency controlled by the government is the perfect way to descend into a nigh unbreakable fascist existence where everyone you meet and know have the ability to tank your credit score by giving you bad ratings like Black Mirror. Imagine how effective cancel culture will be when that sort of thing comes about. Imagine not being able to buy groceries for a day because some zoomers rated you ‘cringe’.

This might not be the worst conceivable timeline but we haven’t seen the end result of today’s machinations turning into the totalitarian domination of tomorrow, with free thinkers getting sent to labor camps if they’re lucky, or becoming an example of what happens to those who go against the ideas of the prevailing authority if they’re not.

So what countries are currently speeding toward this nihilist future? A lot of them. According to atlanticcouncil.org, 114 countries are looking into developing a proprietary CBDC for their nation, and some have already been successful on some level.

The “Multiple CBDC Bridge” project, or mBridge, was a joint rollout of a pilot program utilizing cross-border payments in digital currencies issued by central banks of China, Hong Kong, Thailand and United Arab Emirates. It’s important to note that the use case in this situation was strictly wholesale, as the CBDCs involved — with China’s E-CNY digital currency being the most widely issued — were used in order to settle cross-border trades.

That sounds all well and good but I can see all sorts of holes in this system even if it’s 100% honest. For instance, if multiple CBDCs are being used and exchanged for trade deals, what happens when China inevitably starts welshing on deals in some form when they start undervaluing other nations’ digital currencies in order to increase their profits, and a trade dispute arises? I don’t have the answer to that question, so if someone does, fill me in.

My guess is that this test, which completed last September, was conducted because China needs to make sure they’re wholly unaffected by any attempts to curtail their economic activities through U.S.-backed sanctions in response to hostilities toward Taiwan as they attempt ‘Reunification’ with the island nation.

With no way to sanction them, the U.S. will inevitably get involved militarily should China attempt to invade Taiwan. If nothing else tips us into it beforehand, that sounds like a guaranteed World War scenario, to me. But I digress.

Who else has been successfully progressing toward a totalitarian stranglehold on commerce? Jamaica has recently issued their own digital currency from their central bank, called JAM-DEX (Jamaica digital exchange). They even went so far as to coerce adoption of the digital currency by promising that the first 100,000 citizens to sign up would receive a deposit of $2,500 for doing so.

Just like the covid vaccines, I would be skeptical about any program that you’re paid to enter. There’s a good chance that what they’re offering will screw you over in the long run. Just ask the vaccine injured about that sort of thing. But again, I digress.

Australia, Singapore, Malaysia, and South Africa have also ran through a pilot project called Project Dunbar where international settlements were performed through issuance and use of several CBDCs. Again, wholesale only in this case.

So what about retail? Oh, that’s coming as well. Let me refer you to Project Icebreaker.

The Bank of Israel, The Central Bank of Norway, Sveriges Riksbank (Sweden), and BIS (Bank for International Settlements) Innovation Hub Nordic Centre put forth Project Icebreaker, meant to test the interlinking and interoperability of different retail CBDCs. Its main purpose is to test seamless spending of CBDCs across borders. It sounds nice when you phrase it like that, no need to exchange currency if you’re traveling abroad. But imagine you run afoul of the local authorities for violating some local statute you couldn’t have possibly known about or that seems harmless enough. Next thing you know your next purchase is declined and your attempted purchases alerts local authorities to your location to question you about the receipt that was blown out of your hand by a gust of wind, resulting in you catching a charge for littering, for example.

It would incentivize shakedowns of tourists by local authorities to shore up their own finances. It would also discourage traveling abroad because no one wants to have to be a qualified paralegal in French Law just to travel to France and not have any issues, for example.

For model citizens, this is a boon. The problem is, as the video I linked previously can attest, the criteria for being a model citizen can require a certain amount of neurosis to adhere to the stringent requirements that will undoubtedly become incrementally more stringent as more events stoke the illusory ‘need’ for legislators to further clamp down on freedom in response to a rare one-off event.

There are many, many other projects going on around the world. But, shockingly, there has been some pushback here in the U.S. about the potential dangers of a CBDC being implemented here.

Federal Reserve Chairman Jerome Powell had this to say about it: “We would not want a world in which the government sees, in real time, every money transfer that anyone makes with a CBDC.”

That’s encouraging, but ultimately for my part it’s a mere smoke screen because we’re already working on CBDCs right here at home.

The FedNow system, being launched by the Federal Reserve in July of this year, is being touted as a potential lead-in to wide implementation of a CBDC system here in the United States. The Fed naturally denies this charge, but it’s hard to discount when you consider that FedNow is basically doing what the previous CBDC projects I mentioned are meant to do, but initially its launch will only see it utilized for transfers between banks and credit unions.

I’ll defer to Robert F. Kennedy’s wisdom on the matter.

”The Fed just announced it will introduce its “FedNow” Central Bank Digital Currency (CBDC) in July. CBDCs grease the slippery slope to financial slavery and political tyranny.”

”While cash transactions are anonymous, a CBDC will allow the government to surveil all our private financial affairs. The central bank will have the power to enforce dollar limits on our transactions restricting where you can send money, where you can spend it, and when money expires.”

”A CBDC tied to digital ID and social credit score will allow the government to freeze your assets or limit your spending to approved vendors if you fail to comply with arbitrary diktats, i.e., vaccine mandates.”

”The Fed will initially limit its CBDC to interbank transactions but we should not be blind to the obvious danger that this is the first step in banning and seizing bitcoin as the Treasury did with gold 90 years ago today in 1933.”

”Watch as governments, which never let a good crisis go to waste, use Covid-19 and the banking crisis to usher in a new wave of CBDCs as a safe haven from germ-laden paper currencies or as protection against bank runs.”

Rishi Sunak, Prime Minister of the U.K., on the other hand, is very much pro-CBDC. Samuel Leeds does a fantastic job of explaining everything wrong with the implementation of Sunak’s vision.

But again, that’s not here, right? Well, not exactly. There already is a project being conducted here in the United States called Project Cedar. It has progressed past the research phase and is progressing to the development phase.

What is Project Cedar? According to the New York Fed website, “Project Cedar is the inaugural project of the New York Innovation Center (NYIC). It is a multiphase research effort to develop a technical framework for a theoretical wholesale central bank digital currency (wCBDC) in the Federal Reserve context.”

Again, a wholesale cross-border settlements solution is presented initially to try and detach the whole thing from the day-to-day lives of average citizens. But just like how the military often comes up with technologies first, and then they trickle down to the private sector, the New York Federal Reserve is threatening to do the exact same by developing this CBDC weapon of mass destruction in the wholesale sector so that your average low information voter won’t know about it until it’s too late.

They claim that it’s meant to streamline and accelerate settlement periods (which take around 2 days currently) for cross-border payments. With the wCBDC, as they’re calling it, these settlement times are as fast as 15 seconds. But with the benefits come the same set of concerns.

Of course, with no input from the people or their representatives whatsoever, the New York Fed is progressing to Phase II of the project where they will work with Singapore to work out the kinks of international settlements with their respective CBDC development.

And if you really need proof of concept for my concerns about the government’s incremental power creep, look at how policy has changed since even 2001, with 9/11 acting as the convenient precursor to outright destroying the rights of Americans in exchange for the illusion of safety.

If you don’t think the same thing would happen in the case of CBDCs, then you’re beyond my help and I resent your compliance to the true death of freedom.