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IPFS News Link • Central Banks/Banking

Why a "Digital Dollar" Is a Really Bad Idea

• Activist Post

By Brad Polumbo

The widespread embrace of Bitcoin and other cryptocurrencies has left many government bureaucrats feeling left out. In a bid to get in on the action, many governments have floated the idea of a "central bank digital currency," (CBDC) aka a government-issued cryptocurrency using blockchain technology. President Biden directed the federal government to explore this idea, and new reporting suggests the Biden Administration may soon press forward with efforts to create a so-called "digital dollar."

"The U.S. Treasury Department will advise the federal government to press forward on work to issue a digital dollar, though it should only take the final step if there's sign-off that the government-created tokens are in the 'national interest,'" CoinDesk reports. "The question of national interest will depend on further approval of the Biden administration and – potentially – action by Congress."

At first glance, government getting in on the crypto craze might sound fun, novel, or harmless. But it's actually cause for serious alarm. A central bank digital currency would have none of the benefits of cryptocurrencies like Bitcoin—and serious drawbacks.

Why a Central Bank Crypto Wouldn't Be Like Bitcoin