Why the digital euro is a bad idea
The European Union has published its long-awaited plans for a digital euro, a central bank- digital currency, or CBDC, that would allow digital payments throughout the 26-member bloc free of charge.
The text starts with some basic principles: first, that digital or otherwise, a euro will always be a euro. Secondly, that while it can replace it, cash will continue to be available for all purposes. And third, that the digital euro is not intended to jeopardize any of the elements of the monetary value chain or the role of the banking system.
Based on these principles, what do we have on the table? Basically, a CBDC, with all the contradictions that involves. Basically, if the logical evolution of money points to reducing or eliminating the controlling role of central banks and states, CBDCs point in exactly the opposite direction. And for anyone who doubts it, there is the experience of China, the first country to seriously launch a CBDC, which since 2020 has been paying the salaries of public employees in e-yuan. The e-yuan gives the government huge control over economic transactions.
What’s the problem? Quite simply, digitizing money gives whoever makes it much more power. Eventually, digital money could be, in addition to being fully traceable, also programmable, which would make it possible, for example, to create money that…
