Ask HN: Will the government be able to block CBDC transactions of individuals? | Hacker News Reader

Ask HN: Will the government be able to block CBDC transactions of individuals?

4 points_4485 comments

I was watching an "interview" conducted by a politician from the UK, Nigel Farage. He was interviewing a cryptocurrency enthusiast about the Bank of England's CBDC(Central Bank Digital Currency) the "Britcoin". In that interview he said that the government would be able to block individuals from using the digital currency and that gives more control to the government on individuals.

Is this a valid point? If yes, then how is it possible with CBDC?

View on HN

It seems likely that participation in a cbdc will likely require a kyc verification or equivalent real identity to participate as this is how the current system works.

Restrictions would primarily be associated with this account, as well as transactions associated with the graph of related accounts, and associated transactions.

Check out a paper called Money and Payments: The U.S. Dollar in an Age of Digital Transformation from the Board of Governors of the Federal Reserve System. It was released specifically to educate and open a public discussion on these topics and more, and is worth a read.

(Found the link!) https://www.federalreserve.gov/publications/files/money-and-...

And of course there are risks, including enabling new levels of surveillance capitalism. It’s important to keep up and participate in the public processes and give feedback as these cbdcs emerge.

I think this comes down entirely to how the currency is set up.

Some currencies allow this (for instance Tether's controlling company can and do block transactions with certain wallets at the request of the US government). Others which are truly decentralised would NOT allow that directly. This requires a few design properties though: you would want the digital currency to not be trackable from wallet to wallet (like Monero, it would need a built in laundry process) for instance.

Since these are design decisions and in the hands of central banks, it comes down to their will...

I don't think any of the more vocal or advanced CBDC projects have so far answered these questions. But I might be wrong...

> Is this a valid point? If yes, then how is it possible with CBDC?

Of course it is a valid point.

If the government has full programmatic control over the currency, then isn't a given that they have the tools and potential to enact basically anything that is technically possible?

what is the "point" of CBDC? like i want to know.....

why should "blockchain" be used here and not a regular SQL DB? a bank has the accounts of all the savings accounts so with ACID test, it doesn't matter. balances will always be there.

How is "CBDC the magic bullet"?

Could be that the distributed ledger is federated rather than non-federated(like Bitcoin Blockchain).

Reply on news.ycombinator.com