Tech Neutrality and CBDCs: It's Okay To Argue.

Just Don't Throw Your Toys Out Of The Cot - We're Not There Yet

"Guns don't kill people; people kill people." It's a saying that has been recited countless times to underscore one core principle: tools, technologies and instruments, by themselves, are inherently neutral. Their true impact is shaped by those who build and wield them. Today, a new tool is generating heated debate: the Central Bank Digital Currency, or CBDC. There's a movement, calling for a conversation on our financial future emphasising the imperative of designing a financial system that's secure, private, and inherently accessible to all.

At a high level, a CBDC is a digital version of traditional currency, centrally overseen and issued by a central bank. Unlike decentralised crypto like Bitcoin, CBDCs seem to fit within the purview of national financial institutions, ensuring an added layer of regulatory control and security.

The Potential Upsides of CBDCs:

• Efficiency and Transparency: Transactions could be swifter and more transparent. The selling point is streamlining payments and making everything visible.
• Financial Inclusion: Regions or populations that have previously been excluded from the traditional banking system might find it easier to access and use CBDCs, promoting greater economic equality. 2.5 billion – more than half of the world’s working adults- are excluded from financial services.
• Reduced Fraud: We are in a massive financial crime, fraud, scam and security situation. The centralised nature of CBDCs could reduce counterfeit money in circulation and clamp down on illegal financial activities.

The Concerns and Points of Contention:

• Programmable Money: While it might sound efficient, the idea of money that can be programmed or controlled remotely poses significant concerns about personal freedom and autonomy. Imagine money that could "expire" if not used within a set timeframe or funds that can be remotely controlled or even deleted by a central authority.
• Financial Exclusion: It's a common misconception that all Australians have easy access to banking. The reality is, Australia grapples with a significant de-banking issue. The emergence of CBDCs, controlled by a central bank, raises valid concerns. If past practices have seen Australians being denied banking access, there's a looming apprehension that CBDCs might be another avenue for such exclusions to persist.
• Privacy Issues: CBDCs could potentially eliminate the anonymity of cash transactions. Every purchase, donation, or expenditure could be tracked and traced, raising concerns about surveillance and financial privacy.
• Central Authority Overreach: With CBDCs, a significant amount of power would be concentrated in the hands of central banks. Not unlike where we stand now. This could lead to potential misuse or even political manipulations.

For Australians, and all global citizens for that matter, the advent of CBDCs isn’t just financial evolution. It signals a profound transformation in the dynamics of money, privacy, and power within our emerging digital economy. The very public debates should be welcome, frank, respectful, open and involve all industries, governments, and the public at large.

While the technology behind CBDCs is neutral, its implementation will carry the weight of human intentions, both good and bad. Just as guns, in the hands of responsible individuals, can be tools of protection, CBDCs, if introduced with foresight, caution, and public consultation, can potentially revolutionise the financial landscape for the better.

Logical, level headed, educated and respectful debate never hurt anyone. The financial future will be directly shaped by our intentional actions and meaningful contributions.

#CBDC #CRYPTO #BLOCKCHAIN #TECHNUTRALITY