Clearing misinformation around CBDCs — Central Bank Digital Currency

There seems to be a lot of misinformation about Central Bank Digital Currencies (CBDCs). The perception is that it is somewhat similar to Bitcoin and other cryptocurrencies. It certainly is NOT. At a basic level, CBDC is the digital version of the country’s currency. but this statement glosses over the details.

The difficulty in explaining CBDC is that there are no set standards for it yet. Experts are still trying to figure out what a CBDC ought to be, and eventually, America’s CBDC might be very different from China’s CBDC which could be very different from Japan’s CBDC.

The best way to convey what it is, therefore is to describe- What has happened so far in the space? What can we do with CBDCs that we cannot do with the current form of currency? What are the motivations of the parties involved? And how does CBDC compare to bitcoin?

The story so far!

When Facebook announced plans of launching Libra- a digital currency pegged to a basket to fiat currencies, it scared us all. We were already fearful of the growing power of Big Tech with its ability to manipulate minds, take away our privacy, and even subverts elections. Now they wanted to take over the global financial system as well? America wasn’t going to let that happen.