Altcoins Talks - Cryptocurrency Forum
Cryptocurrency Ecosystem => Solana Forum => Topic started by: KryptoBull on March 17, 2024, 01:46:31 AM
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CBDC is often seen by the crypto community as a risk rather than a solution for the economy because it can become a tool for governments to increase financial control over citizens and hinder the widespread adoption of crypto [1]. However, from a certain perspective, CBDC can be deployed on blockchain, providing services that do not require traditional banks, increasing transparency, saving transaction costs, and being a safer alternative than stable coins currently on the market. crypto market [2]. The Ethereum Foundation also welcomes the deployment of CBDC on the Ethereum blockchain [3], and some CBDC pilots have taken place on Ethereum because Ethereum is the best blockchain in terms of synthetic criteria based on decentralization, security, flexibility and speed [4].
Recently, an Israeli crypto firm, Bits of Gold, has launched a pilot program for the country's first-ever digital currency pegged to the Israeli Shekel - BILS. The pilot program is being conducted in collaboration with the Israeli Capital Market Authority (ICMA), so I consider BILS to be a CBDC of Israel. What's interesting is that BILS is deployed on Solana - a blockchain famous for its high speed of 65k tps and extremely cheap transaction fees, only 0.00025 USD per transaction [5].
Youval Rouach, Bits of Gold’s co-founder and CEO: “We are proud to introduce BILS, a ground-breaking development that literally connects digital currencies into the Israeli economy. The introduction of BILS marks a significant progression in integrating digital currencies into the Israeli economy, while expanding financial accessibility” [6].
Personally, I don't hate CBDCs too much if they are implemented more effectively than Venezuela's Petro [7] and more transparently than what China is doing with e-CNY [8] or Russia is doing with Digital Ruble [9]. Israel is a country with advanced science and a stable economy, which would be an ideal place for CBDCs to be tested and show us the positive values of CBDCs.
I am also very happy that the Solana blockchain has been chosen, which is a recognition of the value and reliability of the Solana blockchain after 4 years of operation, and is also a signal that the competition between blockchains will not only take place on DeFi or GameFi but also in the field of CBDCs. Ethereum has already participated, and Solana will also be there to compete and develop.
I would like to know your views on Israel's CBDC on the Solana blockchain:
- Do you expect the positive values that Israel's CBDC will bring?
- Is Solana blockchain worthy of being chosen for this CBDC pilot?
- Are you ready to use CBDC on the Solana blockchain?
References:
[1] A Central Bank Digital Currency Would Be Bad for the US (https://www.coindesk.com/policy/2021/05/17/a-central-bank-digital-currency-would-be-bad-for-the-us/)
[2] The Advantages—and Drawbacks—of Central Bank Digital Currencies (https://www.forbes.com/sites/forbesbooksauthors/2023/02/07/the-advantages-and-drawbacks-of-central-bank-digital-currencies/)
[3] Blockchain Solutions for Central Bank Digital Currency (CBDC) (https://consensys.io/solutions/payments-and-money/cbdc)
[4] Mastercard’s CBDC pilot ventures into Ethereum and NFTs (https://blockworks.co/news/mastercards-cbdc-pilot-ethereum-nfts)
[5] What Is Solana (SOL) and How Does SOL Crypto Work? (https://www.investopedia.com/solana-5210472)
[6] Israeli Crypto Firm Launches Pilot for First Shekel-Backed Stablecoin (https://news.bitcoin.com/israeli-crypto-firm-launches-pilot-for-first-shekel-backed-stablecoin/)
[7] Venezuela Terminates Petro Cryptocurrency After 5 Years (https://finance.yahoo.com/news/venezuela-terminates-petro-cryptocurrency-5-044753642.html)
[8] China’s Digital Currency: The hopes and fears of the e-CNY (https://www.chinacenter.net/2023/china-currents/22-1/chinas-digital-currency-the-hopes-and-fears-of-the-e-cny/)
[9] Digital Ruble: Definition, How It Works, History, and Goals (https://www.investopedia.com/terms/c/cryptoruble.asp)
Note:
- My opinion was posted first in that topic, on Bitcointalk (https://bitcointalk.org/index.php?topic=5489201)
- I leave the source link to avoid plagiarism accusation.
- I excluded/ included minor things from an original thread if necessary.
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I am also very happy that the Solana blockchain has been chosen, which is a recognition of the value and reliability of the Solana blockchain after 4 years of operation, and is also a signal that the competition between blockchains will not only take place on DeFi or GameFi but also in the field of CBDCs. Ethereum has already participated, and Solana will also be there to compete and develop.
I would like to know your views on Israel's CBDC on the Solana blockchain:
- Do you expect the positive values that Israel's CBDC will bring?
- Is Solana blockchain worthy of being chosen for this CBDC pilot?
- Are you ready to use CBDC on the Solana blockchain?
Compared to stablecoins, CBDCs could have an advantage because there is no longer any concern about proof of reserve like Tether. It will also have more users, making each CBDC user a potential investor and easy to enter the market. However, this does not reduce concerns about user privacy and freedom.
1. I will wait for the results of this CBDC pilot in Israel, I hope that it is positive enough for us to be optimistic about the potential for CBDC adoption in the future.
2. Solana still has stability issues but still outperforms most blockchains in the market thanks to its large number of validators, high speed, and low fees. If the Solana team can further improve the stability of the network and there are no more outages, it will be extremely suitable for deploying CBDC solutions.
3. Currently, I do not have the ability to access CBDCs on Solana. If the test results are good and other governments are also willing to use Solana for their CBDCs, I will try it out.
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Compared to stablecoins, CBDCs could have an advantage because there is no longer any concern about proof of reserve like Tether. It will also have more users, making each CBDC user a potential investor and easy to enter the market. However, this does not reduce concerns about user privacy and freedom.
USDT is far more private than CBDC...
I think CBDC will be much similar to fiat. You will be identified in every transaction, just like in the banking system. The problem, is that who owns your data in the bank system is the bank (a private company).
When using CBDC, the central bank (or the government) will have all your data
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USDT is far more private than CBDC...
I think CBDC will be much similar to fiat. You will be identified in every transaction, just like in the banking system. The problem, is that who owns your data in the bank system is the bank (a private company).
When using CBDC, the central bank (or the government) will have all your data
Currently, Tether is also a centralized protocol and can freeze user accounts. I think CBDC will be similar, but we have to accept it if what it brings is really more valuable than the risks. I wouldn't be surprised if CBDC will compete with USDT in the future.
2. Solana still has stability issues but still outperforms most blockchains in the market thanks to its large number of validators, high speed, and low fees. If the Solana team can further improve the stability of the network and there are no more outages, it will be extremely suitable for deploying CBDC solutions.
The Solana team is working on perfecting the technology to ensure that the Solana blockchain will operate more stably, avoiding unfortunate incidents. Suppose CBDC is being operated and the Solana network is down for a few hours, the entire economy will face many problems and suffer huge losses when transactions cannot be made, equivalent to an economic slowdown :(
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USDT is far more private than CBDC...
I think CBDC will be much similar to fiat. You will be identified in every transaction, just like in the banking system. The problem, is that who owns your data in the bank system is the bank (a private company).
When using CBDC, the central bank (or the government) will have all your data
Currently, Tether is also a centralized protocol and can freeze user accounts. I think CBDC will be similar, but we have to accept it if what it brings is really more valuable than the risks. I wouldn't be surprised if CBDC will compete with USDT in the future.
Usdt can freeze your coins, but you don't have to go into kyc process to use it.
You will have to to use cbdc
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- Do you expect the positive values that Israel's CBDC will bring?
No, I don't expect any positive values form Israel's CBDC and I really don't support it at all. CBDCs are created to disrupt our crypto-market, they can't be beneficial for us.
- Are you ready to use CBDC on the Solana blockchain?
I'm not ready to use CBDC on any blockchain, so my answer is no. I'm not someone who may support CBDCs because I find them more as a threat to our crypto-ecosystem than as a remedy.
I even suggest others to be careful from the trap of CBDCs, the CBDCs are regulators new weapon to bring all crypto users in their supervision once again. They want to observe the actions of crypto users that's why they are creating CBDCs.
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No, I don't expect any positive values form Israel's CBDC and I really don't support it at all. CBDCs are created to disrupt our crypto-market, they can't be beneficial for us.
I'm not ready to use CBDC on any blockchain, so my answer is no. I'm not someone who may support CBDCs because I find them more as a threat to our crypto-ecosystem than as a remedy.
I even suggest others to be careful from the trap of CBDCs, the CBDCs are regulators new weapon to bring all crypto users in their supervision once again. They want to observe the actions of crypto users that's why they are creating CBDCs.
I understand this, this view is popular in the crypto market because we all understand what governments can do with CBDCs to increase their level of financial control over citizens. I am only interested in CBDCs because it has the potential to be an unstoppable wave, as governments link up and apply CBDCs extensively to the economy in the future. I want to be prepared for the changes that may come, because currently, through digital currency in the electronic banking system, the government can also track and freeze transactions if it wants, CBDCs will only be an on-chain version of digital currency. CBDCs are only worse than crypto, not worse than digital currency.