Ripple Getting Into The CBDC Game
For the last few years, Ripple garnered support from the old guard in the cryptocurrency community. Taking on the Securities and Exchange Commission (SEC) was applauded by many in the community.
Unfortunately, the wolf always reveals itself even when in sheep's clothing.
Most knew that Ripple was not a cryptocurrency. This was further revealed as it unveiled it latest platform that designed for the creation of central bank digital currencies (CBDC).
An article in Finbold stated this:
On Thursday, May 18, Ripple announced it is rolling out a central bank digital currency (CBDC) to enable central banks, financial service providers, and governments to launch their own digital currency.
This is obviously a lightning rod topic as many see the potential for government abuse. Due to history, this is a valid concern.
In the United States, we are starting to see this form along political lines. There are sides being draw.
We know that, in spite of their battle with the SEC, Ripple is firmly aligned with the establishment. Of course, this was something many in cryptocurrency knew from the earliest days.
It Is All About Control
Some feel that CBDCs are, in theory, a good idea. The problem with this viewpoint is it overlooks the basic facts of what this debate is about.
If we harken back to the first days of Satoshi Nakamoto and Bitcoin what was that all about? The answer lies in the major breakthrough, the decentralized solving of the double spend problem. This was Bitcoin's major innovation that instantly changed the entire spectrum of monetary systems.
The reason is because it altered who controlled the ledger. Today, banks run the ledgers monitoring all transactions and accounting for all balances. Who runs the banking system? Obviously the banks. When we ask who runs Bitcoin, the answer is a bunch of unrelated miners.
CBDCs are no different. It is all about control. Governments want control. More specifically, politicians and bureaucrats want to be able to impose their will on the populations they are suppose to be serving. Hence why CBDCs are such a hot topic.
We hear talk of terrorism and illegal activities. These are buzzwords to frame cryptocurrency as the haven for criminals and "very bad people". We know, of course, this isn't true yet it is exactly how they conduct the discussion. This is mean to turn people away from this and towards the solution they offer.
After all, they are the only ones who can protect us.
Loss In Confidence By Governments
One aspect to this entire discussion is the collapse in confidence in government that is taking place.
For decades, governments were able to operate in a manner where they could control the narrative. Through the media, which the majority of people believed, we saw the rhetoric positioned in such a way that people were agreeable to what governments were doing.
This is no longer the case.
To start, the mainstream news is falling on its face. The trust that it once had is dwindling rapidly. Here is the propaganda arm losing its effectiveness, something that really hurts those in power. Without an unobstructed path to get their message out, they have challenges.
We also see revelations of the cozy relationship between these two parties. There was really no line because them, meaning our media was essentially a mouthpiece for the governments.
People now realize this and are turning away from the MSM.
At the same time, people are finding the behavior of the political establishment simply laughable. Does anyone really believe that someone like Gary Gensler and the SEC is really looking out for people? The relationship between him, FTX, and other members of the Biden Administration is starting to come to light. It is not a very good image.
Divisive politics is an effective strategy for blowing things up. This is a problem since, once released, it can not be put back in the bottle. We see the division fostered most by the political class (with the help of the media) across the developed countries. This is going to cause major social issues especially if economic conditions deteriorate.
Developing nations are going to get obliterated as they find the USD is the safety place. This will be the last one to fall. Before that, it will wipe out everything else.
A sovereign debt crisis will lead to revolution in many areas. Look at France and what is happening with the pensions. There is outrage at the move to raise the retirement age. What happens when default means that pensions are wiped out?
This is a possibility in many areas as governments are going to face major challenges. Debt is an asset that has value as long as someone is willing to buy if. When that stop, it becomes worthless.
HBD As The Solution
It wouldn't be prudent to discuss a matter like this without mentioning HBD.
To start, many fear CBDCs, especially in the US. This is not valid in my view for a couple reasons. We can first look at the fact the Fed already has one; they are called reserves. This allows the Fed to operate as it sees fit. Thus, there is no reason for it to turn to a CBDC other than for settlement. Of course, reserves can be used for this purpose.
Another is constructing one, especially for the political establishment, is difficult. It is much easier to step into something that it can control.
For this reason, I think the US "CBDC" will be USDC. This is something that will fall under the control of the US Government since it can be regulated. It is already tied to US monetary policy since it is using USD cash and bills as the reserve. Once Circle becomes under banking regulations, they are at the mercy of what the government wants.
Here is where HBD is the counter to that. Unlike CBDC, there is no way to get it under regulatory framework. This means that is can spread throughout the world in a manner without resistance.
Also, unlike Ripple's system, this is completely open and decentralized. There are more than 100 unrelated nodes producing blocks. That is not what Ripple will do.
Money is always a game of confidence. Central bankers think the confidence in their currencies comes from assurances of those institutions. Unfortunately, their main goal these days is to stay relevant. For this reason, confidence there is almost non-existent.
We are looking at a paradigm shift. There is a move from public to private as the masses turn away from these institutions. This is where cryptocurrencies will step in.
Look at what is taking place in Venezuela to see how things are changing. Those in Sucre are starting to develop an economy around HBD. This is a marked changed and providing real world use cases for the currency.
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To control, information will need to be harvested. Any open blockchains provide information.
How will government control HBD users? Simple.
Harvest on chain data and associate it with Social Credit Score, even if they cannot prevent you from purchasing or transfer at the point of sale or p2p, it is controlling indirectly by deducting your score.
How are they going to know who is doing what? It is possible to set up an account and have it not tied to a real world identity.
There are a lot of people on Hive we have no idea who they are and neither does the government.
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Internet censorship and login that ties to your real world ID. If it is implemented at the ISP and regulatory level.
In addition, mass surveillance grid with AI and facial recognition.
When we take out our phones, our locations are already tracked right now.
Because the blockchain record is permanent, we may think the technology is not there yet, but it is here. Just the matter of integration.
Even with BTC, all it takes is interacting with KYCed accounts, with each interaction the probability of identifying the real identify goes up.
A great insightful update of the momentum! I have given away all my XRPs last year to a broker, never saw anything back from that small fortune. At least here, in Hive, I feel more secure with my assets. Yes, USDC might be a feature of the digital dollar in the blockchain, it is fragile even now.
Well not sure what you did with a broker but yes I do agree there is a lot of good things that make Hive stand out compared to a lot of other things. We will see if people catch on.
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With decentralization being one of my focal interest in cryptocurrency it wasn't long before I to spot Ripple is far from decentralized crypto, so it is no surprise it is working on launching CBDC to enable central banks to launch theirs.
It is pathetic that raising the retirement age is being proposed in France, I wonder if that fails to work, what next. Maybe work till their last breath.
The entire premise of CBDC hinges on the idea that its adoption will be forced.
I think it's funny that so many people are worried.
99% of all crypto out there is controlled by a centralized entity.
Why would anyone assume that wouldn't extend to government?
If CBDC is introduced as a card (like an EBT), but unlike EBT the currency is more like credits, then there is a lot to be fearful of. There will be no converting these credits into any other (more privately handled) medium. Government will know exactly how you wish to spend the money and will be able to directly regulate how and on what you spend.
USDC will be like the perfect CBDC for the US government. Any stablecoin that's not decentralised could end up becoming a CBDC.
The situation in France with increasing the retirement age seems like a way to buy more time where pensioners would not claim their pension because the pension fund could probably be wiped out.
Definitely not chocking to hear this news as Ripple was always seen as the enemy by crypto people. COTI is going to be supplying CBDC's via their trustchain and is slightly different as revenue fees flow back into the COTI stakers within the Treasury and is a genuine business and nothing underhanded. Will Ripple benefit from doing this besides price movement?
In the crypto space, Ripple's true intentions were eventually exposed, shedding its disguise as a genuine digital currency. The rise of central bank digital currencies (CBDCs) highlights the ongoing battle for control, while decentralized alternatives like HBD offer a paradigm shift towards a more transparent and trustless financial system. I am a happy person for having discovered the Hive blockchain at the right time.
The real question isn't the SEC stopping Ripple but what fine they'll charge them lol