US race for digital dollar makes case for Bitcoin, says CEO of deVere Group
With the US government’s work on a potential digital dollar accelerating, meaning a digital dollar could soon become a reality in the US, the case for Bitcoin is “significantly stronger.”
This assessment by Nigel Green, CEO and founder of the deVere Group, one of the world’s largest independent financial advisory, asset management and fintech organizations, comes as Nellie Liang, the US Treasury’s undersecretary for domestic finance, noted that the federal government will begin meetings in the “coming months” on a central bank digital currency (CBDC).
Last week in a speech to the Atlantic Council, Liang said US officials are “actively evaluating whether a CBDC is in the national interest” and highlighted some of the potential benefits of a Federal Reserve-backed digital currency, noting it “could help preserve the dollar’s global role’ and possibly reduce frictions in cross-border transactions.
Nigel Green shared his thoughts with Finbold:
“This is the clearest sign yet that a digital US dollar could soon become a reality, pending congressional approval. With the world’s largest economy now stepping up its efforts, the global race towards CBDC is now intensifying. It is estimated that more than 80 % of central banks around the world are considering launching a digital central bank currency or have already done so. It seems that the US is now determined not to be left behind and is accelerating the project. It seems to have become a critical issue for global leadership, as China is the most economically powerful country leading CBDC implementation.”
Pros and cons of CBDC
In particular, proponents of CBDCs say that digital payments can be processed more quickly than traditional cash or check payments, reducing transaction times and increasing the speed of trade.
In addition, transaction costs can be cheaper to process than traditional cash or check payments, potentially reducing costs for businesses and consumers. A digital system will be able to provide greater access to financial services for people who may not have access to traditional banking services. But Mr. Green further noted:
“While CBDCs may have many advantages, including convenience, efficiency, and transparency, what they lack is privacy. In effect, the digital dollar is Big Brother-style surveillance technology. These state-backed, programmable digital currencies will give governments greater oversight of citizens’ transactions in real time, potentially leading to the collection of sensitive personal information.”
According to the deVere Group CEO, this may include information about individuals’ spending habits, income and other financial activities. He reiterates that “it’s an additional lever of control that they’ve never had before,” and this is why, according to Mr. Green, Bitcoin and cryptocurrencies will become increasingly attractive.
An increasing number of voices in opposition
It is worth mentioning that despite the fact that the US Treasury seems to be preparing for the launch of a digital dollar, there is a growing number of voices in opposition.
Representative Tom Emmer has introduced legislation in the House of Representatives that could restrict the Federal Reserve from issuing a central bank digital currency. Last month, Emmer confirmed that he had introduced the “CBDC Anti-Surveillance State Act” to protect Americans’ right to financial privacy.
According to the lawmaker, the bill would prevent the Fed from issuing a digital dollar “directly to anyone,” prevent the central bank from implementing monetary policy based on a CBDC, and require transparency of initiatives related to a digital dollar.
Nigel Green concluded:
“US participation in the CBDC race underscores more fully that digital is inevitably the future of money. It is increasingly clear that in the not too distant future we will have a multi-faceted system of currencies, including fiat, CBDC and crypto.”
Overall, the deVere chief labels CBDCs as “unattractive” due to concerns about privacy and government surveillance, and calls for “sane, informed public conversation” on the issue.
