The battle for the future of money is heating up in the United States, with some states proposing to ban the "digital dollar" before it even exists, while others quietly pass laws to make it a reality. It's a conflict that has raised concerns about privacy, surveillance, and control.

Florida Governor Ron DeSantis is leading the charge against the digital dollar, announcing a proposed bill to ban it in his state. According to a statement from the governor's office, the legislation is intended to "protect Floridians from the Biden administration's use of financial sector weapons through a central bank digital currency (CBDC)."

DeSantis's bill seeks to prohibit the use of the digital dollar or CBDC as money in Florida and to create "protections" against digital currencies issued by central banks belonging to nations sanctioned by the United States. He hopes that other states will follow suit and establish similar prohibitions to "fight this concept throughout the country."

In the view of the Republican governor, a digital currency "has to do with surveillance and control" of citizens, and it "will stifle innovation." adding that "Florida will not side with the economic central planners. "We will not adopt policies that threaten economic freedom and personal security."

Senator Ted Cruz of Texas is also pushing for a ban on the digital dollar, citing concerns about privacy implications. He argues that a digital dollar "could be used as a financial surveillance tool by the federal government."

As Other States Quietly Take Steps to Move the Digital Dollar Forward...

President Biden issued an executive order last year that instructs several government offices to research creating a central bank digital currency, since then things have appeared to be moving forward with no official updates from the federal government.

The silence seems to be deliberate when it comes to the most recent steps targeting the Uniform Commercial Code (UCC), which are laws that every state has, and every state controls. 

Intended to make sure states can easily conduct business with each other, the digital dollar may be the first time there's been major disagreements between some states and could result in the 'Uniform' codes ending up far from uniform nation-wide. 

Just this week South Dakota Governor Kristi Noem vetoed House Bill 1193 which would have opened the doors for the digital dollar in her state by amending their UCC to allow for fully electronic payments backed only by electronic records "this is extremely troubling. If Congress were to someday create an official electronic currency that is programmable, it would pose significant threats to Americans’ liberty and privacy rights. Why, then, would so many lawmakers want to make it easier for such a currency to be used in their states?"

Both republicans and democrats have made more public statements implying they are against the digital dollar, yet both parties have been found slipping the verbiage needed to make it happen into bills in their states, now there are similar bills headed to vote soon in 20 more states including in Arkansas, Montana, New Hampshire, North Dakota, Tennessee, Texas, and California.

One Major Roadblock Could Still Stop the Digital Dollar from Happening...

Not because they share any of the same concerns citizens have voiced - but nonetheless, they hate the idea and they may have enough power over politicians to get their way - the banks.

Banks see the Digital Dollar as a way for the government to become their biggest competitor.  Imagine - your job pays you in digital dollars, they're stored in an app on your phone, and virtually every place you would spend money accepts it, what do you need a bank for? 

While banks would still have a role when it comes to investing, lending, and securing larger business and personal accounts, the average person could go months, or even years without needing to interact with a bank, and have no need for a personal account. 

A battle with significant consequences...

Both for the future of our economy and the role of the government in our financial lives. Will we become a cashless society dominated by a digital dollar, or will we maintain the status quo? 

Until recently, this all felt like something so far in the future it was hard to really concern yourself with - but as we begin seeing real laws designed to move plans for the digital dollar forward proposed in multiple states, the potential implications are beginning to feel very real.

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Author: Ross Davis
Silicon Valley Newsroom
GCP | Breaking Crypto News

The European Central Bank (ECB) issued a request for "experts with experience" to apply yesterday with the intention of having them serve as volunteers on the group that will craft the regulatory code for the digital Euro system.

Candidates have until January 20 to submit a resume and responses to the five "justify credentials" questions posed by the group's executives.

The chosen individuals will join the Euro Digital Scheme Rulebook Development Group, tasked with creating the guidelines under which this asset can be traded and spent across Europe.

According to an ECB announcement, the development team working on the guidelines for the use of the digital euro will go to work on those guidelines on February 23.

The group's responsibilities include gathering market data and offering a sectoral view of the Eurosystem, as well as aiding in the development of a regulatory framework for the digital Euro. Christian Schäfer, manager of CBDC regulation, is in charge of coordinating all of this.

The building of the digital Euro is well underway...

The ECB has stated that the development group will include of market representatives with relevant experience as well as officials from the Eurosystem.

Payment service providers, banking industry members, and payment institutions/electronic money institutions will be chosen to offer the system. Consumers, brick-and-mortar stores, e-commerce sites, large and small businesses, and other organizations will all be represented on the demand side.

The distribution and implementation of this CBDC are still the subject of ongoing investigation by experts. Nonetheless, the ECB stated in its December report that the digital euro will be an asset that can only be handled and maintained by "supervised intermediaries" that will operate similarly to existing bitcoin (BTC) and cryptocurrency exchanges.

The Upgrade Nobody Wants...

Europeans have spoken, and they do not support the European Central Bank's plan to issue a digital euro. On the other hand, the bank sees the creation of the digital euro as imperative. It claims that the euro could lose "its position as Europe's monetary anchor" if its use as cash "is less and less" in member countries.

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Author: Mark Pippen
London News Desk 
Breaking Crypto News

The "Digital Euro" is expected to officially launch at some point in 2025, and will be issued by the European Central Bank (ECB) as the official Central Bank Digital Currency (CBDC) of Europe. 

We continue to learn more as the project continues developing, which involves creating an entire new framework of rules and guidelines as this is the first-ever digital currency issued by the ECB. 

In the Project's Latest Updates We Get a Look at Something Many Have Been Wondering and Speculating On - How it Will Be Controlled?

In its most recent report, some of these questions are answered as the ECB introduces us to what they're calling "supervised intermediaries" - these will be the organizations having 'direct contact' with individuals, merchants and companies that use the digitized currency once it enters circulation.

For the EBC to consider an entity a qualified "supervised intermediary" that entity must be one supervised and controlled by a previously designated public authority, in charge of guaranteeing that the operations are executed within a pertinent regulatory framework. 

In other words, those already operating under oversight of finance and banking regulations.

Among approved intermediaries - payment service providers, credit institutions, electronic money institutions and payment institutions all 'meet the defined criteria' to provide services using the Digital Euro.

But Don't Expect to See the Digital Euro Next to Your Crypto in your Existing Digital Wallet...

As most expected the Digital Euro and other CBDCs to come will not have much in common with cryptocurrencies - while both are digital the similarities end there, as the way everything from software, to the internet, are used will be completely different.

Owning a Digital Euro does not mean freedom to choose how to store it, any digital wallet or entity that will manage your money, for both individual users and retailers, will be done with tools developed in partnership with, or organizations operating under the guidelines of the European Central Bank.

A test run is scheduled to start at the beginning of the new year and run through the first quarter of 2023  This exercise will include participants from every relevant sector - banks, payment service providers, consumers and merchants, which will then provide feedback to be included in a new report from the Central Bank.  This report is expected to either say that the tech is ready, or highlight what still needs to be changed or implemented before an official launch.

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Author: Mark Pippen
London News Desk 
Breaking Crypto News

The Central Bank Digital Currency (CBDC) is currently in the process of research and development at many financial institutions around the world, and is the subject of debate among global financial transactions and local governments as each makes its own decisions.

Completely separate from the cryptocurrency market, Ripple is now developing new solutions for traditional banks launching CBDC's and has announced that it has implemented a pilot program with privacy locks that may be useful in this market.

Perhaps Ripple is trying to secure their future, if challenges that their XRP token was launched illegally don't go their way.

XRP's Tech To Be Used...

Although with a new purpose, they're pitching the same tech XRP transactions currently use, stating:

"Transactions on the CBDC Private Ledger are verified by the same consensus protocol used by the XRP Ledger, which is far less energy intensive, and therefore less expensive and 61,000 times more efficient than public blockchains that leverage proof-of-work.

In addition to leveraging the XRP Ledger technology, the CBDC Private Ledger is also supported by RippleNet technologies, and the Interledger suite of protocols to enable ultra-high throughput use-cases such as micro-payments."

No Longer A Matter Of  "If" But "When"...

CBDC's will become commonplace, that much is obvious. The US is in early stages of developing theirs, and even smaller countries such as Lithuania and the Bahamas have announced their digital currencies.

However, currently all eyes are on China preparing to launch their "digital yuan".

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Author: Justin Derbek
New York News Desk
Breaking Crypto News

With striking changes in economic habits, countries are now looking towards secure cryptocurrencies to solve monetary problems. But they need look no further than Bitcoin.

For anyone that has been paying attention– and arguably those who haven’t– there has been a notable shift in the basic functionality of the global economy. What may have taken decades more to come to a tipping point, has been spurred into immediacy by the havoc wrought by the novel coronavirus.

More than just crashing economies, halting production, and fracturing supply chains, the virus had another peculiar effect on how money is moved. People began to stray away from using fiat; not just because they were staying home, but also for the propensity that cash has for harboring germs. This quickly translated into shortages of coins and paper, as well as increased pressure on central banking systems to move to digital systems.

While this posed some issues for the underprepared national treasuries, it also devastated those that were underbanked or unbanked. Rushing towards a system that lacked global accessibility and left many stranded. Which could easily explain why green investor focused platforms like Bitvavo saw a massive increase in retail interest of cryptocurrencies.

Specifically, as centralized digital currencies may solve some problems for institutions, but crypto supplies a solution for all.

What is a CBDC?

CBDCs, or central bank digital currencies, are essentially cryptocurrencies that are produced by central bank authorities, and often issued as an alternative to fiat. While the technology isn’t new– and countries like Ecuador have been issuing them since 2015 –there seems to be a renewed vigor throughout global economies to refocus on the digital currencies as embrace of cashless and digital societies becomes ever more relevant.

While these types of currencies were based on the principals and functionality of Bitcoin, they have taken quite a notable departure from the popular crypto. Perhaps the starkest difference between the two is that CBDCs are backed by national resources or fiat, as well as issued by the state. So many of the “pseudoanonymous” perks of investing in Bitcoin and similarly structured cryptocurrencies would not apply. They would also be unlikely to deploy the use of distributed ledgers, one of the defining factors of cryptos.

Another interesting twist to the evolution of centralized digital currencies is that some countries who have released beta versions of them, have also banned competing interests– such as cryptocurrencies– from being freely traded. Which may be a likely explanation to why countries like China have been slowly introducing harsher restrictions in the crypto space.

Why Countries are Rushing to Embrace the Newest Crypto Fad..

So what is it about centralized digital currencies that make them so enticing to traditional financial structures? For once, digital currencies are much less expensive to monitor and implement than our paper fiat systems– which is a benefit to both citizens and national economic systems. Renewing interest and accessibility to the under- and unbanked. Helping to not only ensure supply, but also stabilize growth rate. Which for smaller nations, or those still stuck in economic turmoil, a genuine chance at sovereignty.

So these types of digital currencies could be a godsend for smaller nations that are dependent upon economic powerhouses like the US and European Union. These types of digital currencies could also help smooth the gap between shortages and the natural progression to a cashless society that’s been spurred by declining cash usage in recent years. With the inherent security of digital funds, it could mean less expenditure by enforcement agencies as digital currencies are far less subjected to criminal activity and nearly impossible to duplicate or double spend.

Why Bitcoin will Always Be on Top While there are enticing reasons for central banking authorities to begin gearing towards a more digitized future– there are still many things that centralized digital currencies just can’t offer. In fact, the majority of the founding principles of Bitcoin were conceptualized in stark opposition to centralization at its core. Instead of leaving purchasing power to banks and other centralized authorities, it goes directly to anyone who invests in the token. Creating not only a decentralized paradigm– but a democratized one as well.

CBDCs will still be subject to quantitative easing practices as well as other inflationary practices. Something that Bitcoin, near exclusively, doesn’t bow to. Instead of being backed by a commodity that could run short, become obsolete, or oscillate in value, the token takes its gains from artificial scarcity and investor interest. Making it not only a more reliable source of value, but also a system that can be accessed by almost anyone. Which is something that centralized digital currencies will never be able to do.

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