CBDC Petro fails in Venezuela: the future for all of CBDCs?

[MrSpasybo]

We have now seen many CBDCs globally: over 130 countries  exploring or experimenting with CBDCs. As of January 2024, ten countries have fully launched their CBDCs: The Bahamas (Sand Dollar, 2020), Jamaica (Jam-Dex, 2021), Nigeria (eNaira, 2021), East Caribbean Currency Union (Dcash, 2022), Ukraine (e-hryvnia, 2022), Sweden (e-krona, in pilot testing), South Korea (digital won, in pilot testing), Thailand (Bakong, in pilot testing), Russia (digital ruble, in pilot testing) and Kazakhstan (Teng, in development). Some of the countries are in advanced stages of CBDC development or pilot testing: Europe (digital euro), China (DCEP), United States, United Kingdom, Brazil (real digital), Australia, Singapore, Japan and Canada ^[1].

The development of CBDCs is still in its early stages, and there are many challenges that need to be addressed. And today we have the announcement that Venezuela's Petro, a CBDC launched in 2018 has ceased operations after six years. Initially, it was expected to be a way for Venezuela to overcome US sanctions and attract foreign investment. However, it had to be discontinued when it failed for many reasons:

• Lack of adoption: Petro has never been widely used by Venezuelans: it is not traded on major cryptocurrency exchanges.
• Legal issues: Petro is plagued by legal issues, it is accused of being used for money laundering.
• Scandal: Petro was also caught up in a corruption scandal^[2].

I count the failure of CBDC Petro as a blow to Venezuela's efforts to develop its own cryptocurrency ecosystem, serving as a warning to other governments considering creating their own CBDCs.

I don't support CBDC, because I count it as just a government tool to strengthen financial control and restrain the development of crypto market. CBDCs have potential implications for financial privacy: providing governments with unprecedented access to data about citizens' financial transactions. CBDCs could also have a negative impact on financial freedom: making it more difficult for individuals to save money and protect their assets. I hope the failure of CBDC Petro in Venezuela will cause governments to be cautious and abandon plans to develop CBDCs.

What do you think about CBDC: do you support or oppose it? Do you think the failure of Petro is the future for all other CBDCs? And will governments easily abandon their CBDC plans?
[1] CBDC tracker
[2] Venezuela’s unlucky petro coin to shut down Jan. 15 after 6 years: Report

[hair]

I don't support CBDC, because I count it as just a government tool to strengthen financial control and restrain the development of crypto market

Indeed. CBDC is a way for the government to control our assets. they want to monitor every transaction of the person. the concept of crypto is decentralized. we have freedom without any restrictions.  CBCD is just the alternative to their hands financial control

there are some countries from Southeast Asia that make CBCB including my country
I don't see this effect as beneficial for the crypto community especially those who like Crypto as finance in their hands

[jonathancool220]

I don't support CBDC, because I count it as just a government tool to strengthen financial control and restrain the development of crypto market

Indeed. CBDC is a way for the government to control our assets. they want to monitor every transaction of the person.

If it's like this, it's really dangerous for me because I like my privacy and not be exposed to strangers.
My assets in cryptocurrency cannot be contested because they belong to me alone and there can be no intervention from other people.
If the basic concept of CBDC is as you mentioned, I also don't agree with the existence of CBDC because it changes the basic concept of decentralized cryptocurrency, cryptocurrency is financial freedom and it is the right of those who own the assets.

[MrSpasybo]

I don't support CBDC, because I count it as just a government tool to strengthen financial control and restrain the development of crypto market

Indeed. CBDC is a way for the government to control our assets. they want to monitor every transaction of the person. the concept of crypto is decentralized. we have freedom without any restrictions.  CBCD is just the alternative to their hands financial control

there are some countries from Southeast Asia that make CBCB including my country
I don't see this effect as beneficial for the crypto community especially those who like Crypto as finance in their hands

CBDCs are like fiat on the blockchain: still managed by the government and more can be minted if needed. Perhaps in the crypto era, CBDC is the best that governments can do to increase the level of control over people and compete with decentralized tokens.
Please share your experiences and issues that people may be worried about when using CBDC in your country!

If it's like this, it's really dangerous for me because I like my privacy and not be exposed to strangers.
My assets in cryptocurrency cannot be contested because they belong to me alone and there can be no intervention from other people.
If the basic concept of CBDC is as you mentioned, I also don't agree with the existence of CBDC because it changes the basic concept of decentralized cryptocurrency, cryptocurrency is financial freedom and it is the right of those who own the assets.

The government does not care about privacy, even if its purpose is to increase financial control.
I think that's not a bad purpose for the bureaucracy, but it violates human rights in the financial sector.
Is there a way for us to ask the government to stop CBDC or can we just use fiat+crypto and avoid touching CBDC?

[IvugeoEvolutionCoin]

I don't support CBDC, because I count it as just a government tool to strengthen financial control and restrain the development of crypto market

Indeed. CBDC is a way for the government to control our assets. they want to monitor every transaction of the person.

If it's like this, it's really dangerous for me because I like my privacy and not be exposed to strangers.
My assets in cryptocurrency cannot be contested because they belong to me alone and there can be no intervention from other people.
If the basic concept of CBDC is as you mentioned, I also don't agree with the existence of CBDC because it changes the basic concept of decentralized cryptocurrency, cryptocurrency is financial freedom and it is the right of those who own the assets.
Everyone really wants to maintain their privacy and prefers not to provide any information on the internet, but in reality, cryptocurrencies and exchanges are currently implementing KYC, which will provide information on how many cryptocurrency assets you have. It is very dangerous, but this is the government's job. wants to control the movement of cryptocurrencies.

[DrBeer]

1. As CBDC has already said many times - this is the worst evil that the crypto-world has produced. And we will regret this "heir" to the idea of freedom, independence, privacy... many more times. CBDC is all of the above, but diametrically opposite.
2. If we talk about Venezuela, as well as about any other country with not the best economy and not the most reasonable government, then I have to disappoint everyone - such economies will not be helped neither by CBDC nor bitcoin, nor, for example, by meteorites as a unit of account. Many people mistakenly think that replacing fiat currency with e.g. CBDC or bitcoin will save the economy ! NO ! This is a profound misconception and a fantasy. The economy is saved by... reasonable policy, reasonable management of the country, balanced economy, technology, and everything that generates competitive advantage of the country on the world market. And replacing some "paper wrappers" with other "virtual wrappers" does not change the situation and does not fix the economy.

[MrSpasybo]

Many people mistakenly think that replacing fiat currency with e.g. CBDC or bitcoin will save the economy ! NO ! This is a profound misconception and a fantasy. The economy is saved by... reasonable policy, reasonable management of the country, balanced economy, technology, and everything that generates competitive advantage of the country on the world market. And replacing some "paper wrappers" with other "virtual wrappers" does not change the situation and does not fix the economy.

+1
I agree with you on this, only a strong economy can support the local currency value. USD is supported by the US economy, EUR is supported by the EU economy. It is confidence in the economy that creates the value for fiat.

But in countries with weak economic policies, fiat depreciates very quickly and BTC is the only way that weak people in society can access and use to store asset value in long term. BTC doesn't make things better, but at least BTC makes the situation less bad.

[DrBeer]

Many people mistakenly think that replacing fiat currency with e.g. CBDC or bitcoin will save the economy ! NO ! This is a profound misconception and a fantasy. The economy is saved by... reasonable policy, reasonable management of the country, balanced economy, technology, and everything that generates competitive advantage of the country on the world market. And replacing some "paper wrappers" with other "virtual wrappers" does not change the situation and does not fix the economy.

+1
I agree with you on this, only a strong economy can support the local currency value. USD is supported by the US economy, EUR is supported by the EU economy. It is confidence in the economy that creates the value for fiat.

But in countries with weak economic policies, fiat depreciates very quickly and BTC is the only way that weak people in society can access and use to store asset value in long term. BTC doesn't make things better, but at least BTC makes the situation less bad.

Yes, I absolutely agree that cryptocurrency can become a tool for preserving citizens’ savings from strong inflation, but it’s stupid to dispute this fact.

But as always there are nuances! For example:
- the ability of the population to buy cryptocurrency. We understand that to purchase cryptocurrency you must have available mechanisms. For example, a stock exchange. But this means you need to have a bank card, and the ability to make such payments, pass the CSC, and be a citizen of a country that is not included in the “black list” of the exchange. As we understand, this solution is not for everyone. Perhaps there are physical exchangers where you can buy cryptocurrency for cash...
- Cryptocurrency volatility is a complex issue. I don’t think that an ordinary peasant, having put aside 1000 dollars in Bitcoin, will be very happy when he sees that the value of Bitcoin is falling... An alternative is stable coins. But this is essentially a more complex option than simply buying for local currency, for example dollars, which will also save money from inflation.
- cost of transactions. I don’t think that buying a kilogram of rice will be economically feasible, for example in Bitcoin - the cost of the transaction may be higher than the cost of the product itself

[Jaephoenix]

CBDCs are a form of digital currency issued by a country's central bank. They are similar to crypto, except that their value is fixed by the central bank and equivalent to the country's fiat. Now the problem is that it defeats the whole aim of cryptocurrency, which is centralization and government control. In my country, the eNaira failed woefully and was dead on arrival because the citizen regarded it with disdain anf distrust. And that may be the cause of failure elsewhere.
I think in the future, better itineration of CBDCs would be deployed

[electronicash]

they have planned this CBDC for a long time, they can't let it go waste. people may be try not to use it but if the government together with the banks will be enforcing it to the people they may really be agreeing with them.

i once listen to Max Keiser and he said one example where government can enforce CBDC, the government and the banks will approach you to replace your cash in the bank with CBDC and offer you can't refuse. they will convert your $10,000 cash to digital cash worth $100,000. and of course these digital are just typed there more like printed which in just few months that $100,000 may be less than $10,000 worth because of inflation.

hard to tell we can escape this CBDC but having some crypto will likely be good for us until they criminalize owning BTC and altcoins. i just hope i'm wrong just as Max.

[MrSpasybo]

Yes, I absolutely agree that cryptocurrency can become a tool for preserving citizens’ savings from strong inflation, but it’s stupid to dispute this fact.

But as always there are nuances! For example:
- the ability of the population to buy cryptocurrency. We understand that to purchase cryptocurrency you must have available mechanisms. For example, a stock exchange. But this means you need to have a bank card, and the ability to make such payments, pass the CSC, and be a citizen of a country that is not included in the “black list” of the exchange. As we understand, this solution is not for everyone. Perhaps there are physical exchangers where you can buy cryptocurrency for cash...
- Cryptocurrency volatility is a complex issue. I don’t think that an ordinary peasant, having put aside 1000 dollars in Bitcoin, will be very happy when he sees that the value of Bitcoin is falling... An alternative is stable coins. But this is essentially a more complex option than simply buying for local currency, for example dollars, which will also save money from inflation.
- cost of transactions. I don’t think that buying a kilogram of rice will be economically feasible, for example in Bitcoin - the cost of the transaction may be higher than the cost of the product itself

I'm not sure about the possibility of BTC trading in countries as Venezuela, but some issues I can think of:
+ If the local currency depreciates faster than BTC price fluctuation => BTC is still the better choice.
+ Trading solutions using Lightning Network (Layer-2 of Bitcoin) can reduce transaction fees to $0.001 ^[1]. Transactions in El Salvador are conducted based on this method: cheap and very fast.

CBDCs are a form of digital currency issued by a country's central bank. They are similar to crypto, except that their value is fixed by the central bank and equivalent to the country's fiat. Now the problem is that it defeats the whole aim of cryptocurrency, which is centralization and government control. In my country, the eNaira failed woefully and was dead on arrival because the citizen regarded it with disdain anf distrust. And that may be the cause of failure elsewhere.
I think in the future, better itineration of CBDCs would be deployed

It's good that people are also starting to understand money and the nature of CBDC. The government should have some way to develop the economy and expand the acceptability of digital currency (money in bank's app) instead of launching another version of fiat, CBDC.

hard to tell we can escape this CBDC but having some crypto will likely be good for us until they criminalize owning BTC and altcoins. i just hope i'm wrong just as Max.

I hope things don't get pushed too far. The government is also chosen by the people votes, they will not want to go against millions of people in monetary policies.
Instead of implementing too extreme a policy, they could adopt crypto like El Salvador and tax it to get more budget 
[1] Lightning Network fees

[Gurujebs]

Indeed. CBDC is a way for the government to control our assets. they want to monitor every transaction of the person. the concept of crypto is decentralized. we have freedom without any restrictions.  CBCD is just the alternative to their hands financial control

there are some countries from Southeast Asia that make CBCB including my country
I don't see this effect as beneficial for the crypto community especially those who like Crypto as finance in their hands

I will rather use stablecoins than use CBDC. This is guys want to control half of the world and that's why they are forcing this on everyone throat and when they don't find you friendly they block your account and then you are left with nothing, this is where "not your keys, not your keys " is very important, they want to control people and control their finance. Why would they operate when the banks are already here.

The sad part of this CBDC is that people will use them, they prefer government oriented property than private things the government can't control but the real people that value privacy will not use them. The people that love Bitcoin will continue to use it for transaction and even if the transaction fee is not friendly enough, they will wait for it when it comes down. Screw the government payment platforms.

[notblox1]

I will rather use stablecoins than use CBDC.

There is no big difference between CBDC and stable coins because they can all be programmed to do similar things.
It is true that Tether and other coins right now dont have this in code but developers can change the code very easy if pushed by governments.
We all heard about frozen Tether coins, so that means they can make them expiry on certain date just like CBDC.
CBDC Petro was isolated case and nobody from other countries would accept it.

[trendcoin]

1. As CBDC has already said many times - this is the worst evil that the crypto-world has produced. And we will regret this "heir" to the idea of freedom, independence, privacy... many more times. CBDC is all of the above, but diametrically opposite.
2. If we talk about Venezuela, as well as about any other country with not the best economy and not the most reasonable government, then I have to disappoint everyone - such economies will not be helped neither by CBDC nor bitcoin, nor, for example, by meteorites as a unit of account. Many people mistakenly think that replacing fiat currency with e.g. CBDC or bitcoin will save the economy ! NO ! This is a profound misconception and a fantasy. The economy is saved by... reasonable policy, reasonable management of the country, balanced economy, technology, and everything that generates competitive advantage of the country on the world market. And replacing some "paper wrappers" with other "virtual wrappers" does not change the situation and does not fix the economy.

Replacing fiat currency directly with CDBC is not the right result because an asset with unlimited supply will continue to create inflation. However, Germany managed to get out of the hyperinflation spiral by changing their currencies both after the first world war and after the second world war. Under normal circumstances, money tied to a valuable commodity like oil should have solved some problems. Unfortunately, Venezuela's failure has made me question ordoliberal economic policies.

[DrBeer]

Yes, I absolutely agree that cryptocurrency can become a tool for preserving citizens’ savings from strong inflation, but it’s stupid to dispute this fact.

But as always there are nuances! For example:
- the ability of the population to buy cryptocurrency. We understand that to purchase cryptocurrency you must have available mechanisms. For example, a stock exchange. But this means you need to have a bank card, and the ability to make such payments, pass the CSC, and be a citizen of a country that is not included in the “black list” of the exchange. As we understand, this solution is not for everyone. Perhaps there are physical exchangers where you can buy cryptocurrency for cash...
- Cryptocurrency volatility is a complex issue. I don’t think that an ordinary peasant, having put aside 1000 dollars in Bitcoin, will be very happy when he sees that the value of Bitcoin is falling... An alternative is stable coins. But this is essentially a more complex option than simply buying for local currency, for example dollars, which will also save money from inflation.
- cost of transactions. I don’t think that buying a kilogram of rice will be economically feasible, for example in Bitcoin - the cost of the transaction may be higher than the cost of the product itself

I'm not sure about the possibility of BTC trading in countries as Venezuela, but some issues I can think of:
+ If the local currency depreciates faster than BTC price fluctuation => BTC is still the better choice.
+ Trading solutions using Lightning Network (Layer-2 of Bitcoin) can reduce transaction fees to $0.001 ^[1]. Transactions in El Salvador are conducted based on this method: cheap and very fast.

The realization and mass introduction of such technologies is still far away. Therefore, the simplest and most accessible method for mass consumers is to buy stable currencies such as the US dollar. This solution has a lot of advantages - simple, affordable, very easy to exchange the necessary part of the "stock", and in some cases even make payment in this currency. such a system works in many countries where tourism is a significant part of the economy, personally used both local currency and dollars - Turkey, Thailand, Dominican Republic, Indonesia, ....
This means that I can put in my purse the necessary amount of bills and be sure that at any point I will either pay with them or easily exchange them.

With cryptocurrency, such actions are unlikely