The CBDC: An Instrument Of Financial Warfare

President Joe Biden issued an executive order in March 2022 mandating the expeditious study and development of a new US central bank digital currency (CBDC) “in a manner that preserves Americans’ interests.” The CBDC is coming whether we like it or not.

In addition, it motivated the Federal Reserve Bank to keep doing so. In the United States, efforts in this vein are not limited to the Biden administration.

At the time of publication, CBDCTracker.org reported that three nations/regions had “opened” retail CBDCs (the Bahamas, Jamaica, and Nigeria), five more were in the “pilot” stage, and twenty more were in the “proof of concept” stage.

Many more people have looked into wholesale CBDCs. (“Wholesale” CBDCs are designed for institutional and institutional-like use, whereas “retail” CBDCs are for the rest of us. It is estimated that by 2030, “there might be 15 retail and nine wholesale CBDCs publicly circulating,” according to a report published this month by the Bank for International Settlements (BIS), which outlines the results of a survey of 86 central banks.

By the way, FedNow is currently live as we speak.

High-ranking BIS, central bank, and government officials have made public statements painting CBDCs as a promising step forward in the history of currency. For instance, the BIS has referred to them as “a new tool in the financial inclusion toolset.”

Queen Maxima of the Netherlands and BIS General Manager Agustin Carstens co-wrote an opinion piece with the slogan “CBDCs for the people.” An IMF working paper claims CBDCs can “bank substantial unbanked populations” in developing countries.

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The CBDC, Along With FedNow, Are Not Popular.

The people of Nigeria flocked to the streets a year after introducing a central bank digital currency (CBDC) to demand access to cash. Still, adoption rates were pitiful at best, at less than 0.5 percent. CBDCs are also widely unpopular among Americans. Only 16% of Americans favor the proposal, according to a nationwide survey issued by the CATO Institute in May. 34% are opposed.

Seventy-eight percent said they would not utilize a CBDC if it were made available. Regarding political affiliation, while Democrats are twice as likely to support a CBDC as Republicans (22 percent vs. 11 percent), just as many Democrats oppose it, the remaining 56 percent react with a “do not know.”

Loss of settlement finality associated with physical cash (as abandoning cash accompanies the push for CBDCs), loss of financial privacy, easy seizure of assets, loss of the ability to resolve problems locally with a commercial bank (as it is doubtful that a central bank would become known for its customer service), outright prohibition on spending or purchase limits with specific merchants or certain products, and (peer-to-peer) lending are all risks associated with CBDCs.

The latter could take many forms, such as (to name a few) confiscatory negative interest rates, a currency that expires at a date set by the issuing central bank or government, or restrictions on the purchase of items like gasoline, airline tickets, or red meat to impose a climate agenda.

Another CATO document focused on detecting CBDC dangers correctly points out that a CBDC might lessen access to credit, disintermediate banks, and threaten the meteoric ascent of cryptocurrencies. Moreover, this does not cover how central banks regard legitimate enterprises under state law but engage in illegal economic activities at the federal level.

Even now (with no CBDC launched in the United States), it is difficult for firms in the cannabis industry to open and keep open bank accounts because many traditional banks are subject to stringent government regulations. Is it realistic to expect the Federal Reserve to make special accommodations for the cannabis industry? It is hard to see how CBDCs could exist without severely undermining federalism.

Last but not least, the public feels less inclined to engage in any kind of activity, legal or otherwise, due to heightened surveillance. Interested in immoral activities (such as gambling or pornographic viewing)? Looking to purchase a firearm? You should probably change your ways now instead of continuing on your path.

Are CBDCs All Inclusive?

A brief look back in time reveals the various forms that debanking legitimately operating banks have taken. Beginning in 2013, the Obama Administration’s Justice Department launched “Operation Choke Point,” which targeted gun retailers, payday lenders, and the like by increasing the cost for banks to provide banking services to them and reminding those banks of their obligations under the Bank Secrecy Act and anti-money laundering (BSA/AML) regulations.

Unsurprisingly, this led to a decline in the number of bank accounts held by individuals and businesses.

The cryptocurrency industry has recently been under scrutiny, with regulators ordering the closure of traditional banks that serve the cryptocurrency industry. Nic Carter, who sees similarities between the two operations, has dubbed the second “Operation Choke Point 2.0.”

Given the current cultural and political climate of “canceling” people with dissenting opinions and of Big Tech’s alignment with the government to orchestrate something that resembles more of a PsyOp than “public health” as we have traditionally known it (as evidenced by a FOIA request revealed), the timing of a global CBDC initiative is also suspicious.

Final Thought

Think twice before advocating for a CBDC, as its influence could be used against you if the political winds changed and your ideas or actions were suddenly deemed immoral or criminal by the ruling elite. True financial inclusion necessitates an economic structure where monetary censorship is more difficult to implement. (Paper currency and Bitcoin help here).

Moreover, I am all for technological advancements; however, with the direction we are taking towards the road to totalitarianism, this idea of digital currency does not bode well with me frankly. How about you?

In addition, the BIS recognizes cash as “the most inclusive form of money we currently have.” Financial inclusion has been a hot topic, so the global drive to eliminate it seems rather ironic. SEC Chair Gary Gensler correctly said, “We already have digital currency.”

The name for this currency is “dollar.” We need to establish another digital currency in the shape of a CBDC to address the many flaws of the current financial system.

The extraordinary financial surveillance, censorship, and perhaps debanking the banked that would result from a CBDC’s vesting of such immense authority in a nation-state or its central bank might be used to further various political goals. As a result, it is not precisely hyperbole to claim that civilization is at a turning point right now. We are witnessing the changing of the guard on a mass scale.