German parliamentarian dismisses CBDCs in favor of Bitcoin as global digital money debate rages on
Joana Cotar criticized the digital euro as an unprecedented surveillance risk and sharply questioned its usefulness.
German Parliamentarian Joana Cotar spoke out against introducing a Euro-based central bank digital currency (CBDC), claiming that “no one needs it.”
Cotar stated in a speech on Nov. 9 that the ECB and politicians backing a digital euro are doing so because they want total surveillance of the monetary system.
Bitcoin is healthy money
Cotar said that people who want to engage in digital payments already do so through various methods like Paypal and crypto, while those who wish to preserve their privacy continue to use cash.
She added that Germans who are concerned about the perils of fiat money and want “healthy money” have chosen to hold Bitcoin in their wallets.
Cotar argued that CBDCs would allow unprecedented levels of surveillance into the personal affairs of European citizens, which is a violation of civil rights.
She further asserted that the ECB’s data protection and privacy guarantees ring hollow as the central bank has a history of not keeping its promises. She highlighted certain guarantees the regulator had made about the euro before it was launched — which never materialized.
However, some central banks around the world have been engaged in creating their own CBDC for several years, with some of these digital currencies already in circulation.
BIS keen on CBDCs
International regulators like the Bank for International Settlements have been supporting CBDC projects in multiple countries and believe that they will become a foundational pillar in the future monetary system of the world.
The BIS has been actively engaged in pushing released guidelines for developing and incorporating CBDCs into local financial systems.
The watchdog recently announced that it expects 24 central banks to have their CBDCs ready for launch by 2030.
BIS general manager Agustín Carstens highlighted the significance of CBDCs in a speech on Nov. 8, noting that whether in wholesale form as a type of digital central bank reserve or in retail form as a digital banknote, these new forms of digital money will likely sit at the core of the future financial system.
According to Carstens:
“A modern CBDC at the wholesale level will be developed quite fast and will be a reality quite soon in probably most of the countries of the world.”
The general manager said that CBDCs present fewer challenges on a wholesale level compared to retail and are expected to become a reality within a few years.
Carstens also highlighted that cybersecurity concerns are of paramount importance when it comes to wholesale CBDCs. He added that the public and private sectors need to cooperate to find ways to deal with cybersecurity threats adequately.
In June, the BIS officially introduced the concept of a Unified Ledger — a system that facilitates the coexistence of tokenized bank deposits and wholesale CBDCs on a shared infrastructure. The platform would enable seamless settlement of interbank payments using wholesale CBDCs.