Lack of privacy, economic calamity: the threats of a digital dollar

As demand for cryptocurrency like bitcoin skyrockets, the Federal Reserve announced the idea of a digital dollar, which would be an electronic fund under control of the government and presented as a sort of competitor to other cryptocurrency. But a central online dollar would work nothing like bitcoin, and it could accelerate interest with other cryptocurrency due to inflation and privacy concerns. Such a system could mirror similar efforts in China, where convenience gets traded for civil liberties.

Treasury Secretary Janet Yellen has warned the public against the use of cryptocurrency, calling it dangerous and suggesting it needs regulation. But it is unlikely that a central online dollar, backed by fiat money, would satiate the demand for digital assets. Most people will move to purchase cryptocurrency to hedge against inflation as the dollar declines in value, due in part to more dollar printing by the government. Consider that $10 in 1980 had about the same buying power as $30 in 2020.

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The cashless society from an ethical point of view

The debate about the move towards a cashless society has been at the center of the scene for several years, now. Various angles have been taken by economists, politicians, banking institutions and sociologists. Beyond the technicalities of the debate, lies the question of freedom, of inter-citizen solidarity and of governmental responsibility. The debate cannot remain in the hands of financial specialists, it is first and foremost an ethical, political and societal issue.

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