Americans Don't Want A Central Bank Digital Currency; New Poll Finds

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BY Zero Hedge  TYLER DURDEN - Adam Dick - JUN 12, 2023

A recent poll conducted by the Cato Institute has shed light on the sentiments of Americans towards the potential introduction of a central bank digital currency (CBDC). The results reveal that a significant portion of Americans, 34 percent of participants, oppose the idea, while only 16 percent support it. These findings highlight a clear divide among those with an opinion on the matter.

The poll, which was conducted in collaboration with YouGov from February 27 to March 8, offers encouraging insights for individuals concerned about the potential threats that a CBDC could pose to freedom and privacy in the United States. It suggests that if Americans are properly informed about the potential abuses of power associated with a CBDC, many currently undecided individuals may find compelling reasons to oppose its introduction.

In a comprehensive article published by the Cato Institute on May 31, authors Emily Ekins and Jordan Gygi elaborate on the poll results. They point out that overwhelming majorities of Americans would oppose a CBDC if it meant that the government could control their spending (74%), monitor their transactions (68%), eliminate physical cash (68%), make them vulnerable to cyberattacks (65%), impose taxes on those who refrain from spending during recessions (64%), or freeze the digital bank accounts of political protesters (59%). Additionally, a slim majority (52%) would be opposed if the introduction of a CBDC led some individuals to abandon private banks, resulting in bank closures.

Interestingly, the current runners-up in the Republican and Democratic presidential primaries, Ron DeSantis and Robert F. Kennedy Jr. appear to be aligned with the anti-CBDC stance. It is hopeful that more politicians will join them in the fight against the potential threats posed by the Federal Reserve and the US government.

However, it is not solely the responsibility of politicians to safeguard the interests of the American people. It is equally important for citizens across the country to engage in education and awareness initiatives to convey why the implementation of a CBDC in America is unacceptable. Fortunately, the Cato Institute's recent poll suggests that a significant portion of the population may be receptive to this message, providing an opportunity for widespread dissemination of information and a potential shift in public opinion.

In conclusion, the Cato Institute's poll illuminates the public sentiment regarding a central bank digital currency in the United States. The results indicate substantial opposition to the introduction of a CBDC, with concerns surrounding government control, privacy, and potential abuses of power. As the debate continues, it is crucial for both politicians and citizens to work together in addressing these concerns and ensuring that the interests of the American people are protected.

The concept of CBDC

A central bank digital currency (CBDC) is a digital form of a country's official currency, issued and regulated by the central bank. It is essentially a digital representation of traditional fiat currency, such as the US dollar or the euro. Unlike cryptocurrencies like Bitcoin, CBDCs are centralized and operate within a regulated framework established by the central bank.

The primary objective behind the development of CBDCs is to provide a digital payment instrument that is backed by the central bank and operates in a secure and reliable manner. CBDCs aim to leverage the benefits of digital technology while maintaining the stability and trust associated with traditional fiat currencies.

The design and implementation of CBDCs can vary depending on the country's specific goals and requirements. There are generally two main models of CBDC: retail CBDCs and wholesale CBDCs.

Retail CBDCs are intended for use by the general public and function as a digital alternative to physical cash. They can be held and transacted through digital wallets or mobile apps, allowing individuals and businesses to make payments and store value digitally. Retail CBDCs aim to enhance financial inclusion, improve payment efficiency, and offer a secure and convenient means of conducting transactions.

Wholesale CBDCs, on the other hand, are primarily designed for financial institutions and serve as a settlement asset for interbank transactions. Wholesale CBDCs can streamline the clearing and settlement processes, reducing costs and increasing the speed of transactions between banks and other financial entities. These CBDCs are not typically accessible to the general public.

CBDCs have the potential to introduce several benefits. They can enhance the efficiency of payments by reducing transaction costs, increasing transaction speed, and enabling round-the-clock availability. CBDCs can also promote financial inclusion by providing individuals without access to traditional banking services an avenue to participate in the digital economy. Additionally, CBDCs can improve transparency and reduce the risk of illicit activities by providing a traceable digital trail of transactions.

However, the introduction of CBDCs also raises various considerations and challenges. These include issues related to privacy and surveillance, cybersecurity, financial stability, monetary policy implications, and the potential impact on the banking system. Central banks and policymakers need to carefully assess these factors and design CBDC frameworks that strike a balance between innovation, efficiency, and safeguarding public interests.

It is worth noting that while some countries are actively exploring and piloting CBDC projects, the implementation of CBDCs is still an ongoing process, and different jurisdictions may adopt different approaches based on their specific needs and circumstances.

Public protest against CBDC

Public protests against CBDCs can stem from various concerns and considerations. Some of the common reasons for public opposition or protests against CBDCs include:

  1. Threats to Privacy: One of the primary concerns is the potential infringement on privacy. CBDCs can enable increased surveillance as every transaction can be tracked and monitored by the central bank or relevant authorities. This level of transparency raises concerns about personal financial information and the erosion of individual privacy.
  2. Loss of Anonymity: CBDCs can remove the anonymity associated with cash transactions. Every digital transaction can be linked to an individual or entity, potentially affecting personal freedom and financial autonomy.
  3. Government Control: The introduction of CBDCs can raise concerns about the extent of government control over individuals' financial lives. Critics argue that CBDCs could allow governments to monitor and potentially control how individuals spend their money, leading to restrictions on certain transactions or the imposition of taxes or fees.
  4. Cybersecurity Risks: As CBDCs rely on digital infrastructure, there are concerns about potential cyber threats and vulnerabilities. If not adequately secured, CBDC systems could become targets for hackers, leading to financial losses and compromising the stability and integrity of the currency.
  5. Financial Exclusion: While CBDCs aim to enhance financial inclusion, some individuals worry that a fully digital system could marginalize those without access to technology or digital literacy, further exacerbating existing inequalities.
  6. Impact on the Banking System: CBDCs have the potential to disrupt the traditional banking system. Concerns are raised about potential bank runs, reduced deposits, and the potential for commercial banks to lose their role as intermediaries if individuals can directly hold and transact with CBDCs.
  7. Centralized Control: Critics argue that CBDCs reinforce centralized control by the central bank, potentially limiting financial innovation and reducing competition within the financial sector.
  8. Technological Reliability: Skepticism exists regarding the technological infrastructure supporting CBDCs. Concerns include the risk of system failures, power outages, or other technical issues that could disrupt the functionality of CBDCs and potentially cause financial disruptions.

It is important to note that these concerns and protests may vary among individuals and communities, and public sentiment can differ based on cultural, political, and socioeconomic factors. It is crucial for policymakers to address these concerns, engage in transparent dialogue, and incorporate public feedback in the development and implementation of CBDCs to ensure the best outcomes for society.

Conclusion

In conclusion, the public sentiment surrounding central bank digital currencies (CBDCs) is complex and multifaceted. While some individuals see potential benefits in terms of efficiency, financial inclusion, and transparency, others voice strong concerns and protests against CBDCs.

The main points of contention raised by the public include threats to privacy and anonymity, worries about government control and surveillance, cybersecurity risks, potential financial exclusion, disruptions to the traditional banking system, concerns about centralized control, and doubts about the technological reliability of CBDCs.

These concerns highlight the need for policymakers to carefully address and mitigate the potential risks and challenges associated with CBDCs. Transparency, public engagement, and incorporating feedback from various stakeholders are crucial in ensuring that CBDC frameworks are designed to protect individual privacy, promote financial inclusion, safeguard against cyber threats, and maintain the stability and integrity of the financial system.

As the discussion around CBDCs evolves and more research and pilot projects are conducted, it is essential for policymakers to strike a balance between harnessing the potential benefits of CBDCs and addressing the legitimate concerns expressed by the public. By doing so, the implementation of CBDCs can be guided by the principles of inclusivity, security, and public trust, ultimately contributing to the well-being and advancement of the economy and society as a whole.