I don't know if you've noticed that we are increasingly witnessing a flood of countries looking to make digital on their national money. The same countries that are campaigning to make their money digital, they usually open a war with cryptocurrencies, in China they banned mining companies from using energy to mine Bitcoin, but before that they had already banned all types of crypto trading in the country.
In Africa however, Nigeria which is a power on the continent and in the adoption of cryptocurrencies, the central bank declared that the use of cryptocurrencies had yet to be reviewed and that it was not 'legal' to commercialize them. However, months later it came to the public to say that the country is working on the development of a digital currency, the digitized Naira.
Both China, which is a major economy in the world, as well as Nigeria, which is also a major power, categorically claim that the digitally issued currency will be created on the blockchain.
But what's the plot here
The centralized digital currencies, also known as CBDC (central bank digital currency) will be issued and regulated by the central bank of each country. They will not be processed openly and will never interact with the decentralized world. They will, however, be of great value to the state as they will be cheaper to create (despite requiring a very significant initial investment in technology) and payments can be sent remarkably quickly.
For the good practice of the same, banks will have to make several alliances with both telecommunications services, convenience stores, online payment services (financial giants for example alipay in China) to be able to make use of digital money and make the technology work in their territories. Financial partnerships will have to be made with external countries for international transfers.
Benefits
The service will be very fast and convenient as the world moves to digital, where payments via paper money continue to decrease over time.
The government will save more on its issuance since it will be done entirely in digital currency
Disadvantages
It will be issued by central banks
Its issuance will further increase monitoring and control
It will still continue to suffer inflation, as it can be issued as soon as it is justified by governments
It will backed up by Fiat money or even other assets like gold or even silver
The same problems that Fiat has today, the digital will also only be issued via e-currecy
This is how digital money is Fiat money in the form of digital payment, they will only stop using paper. Nothing will change except to increase investments in infrastructure to make it work.
It is a currency modernization but it does not bring new to the common citizen who will continue to use it, privacy and freedom will only increase. The intrusion will be even more dangerous as all valuable digital movements will leave a permanent record in the payment network. All movement of money will be highly controlled and will be monitored 24 hours a day.
While physical money could still be withdrawn from an ATM and used anywhere without being noticed, digital will not do that. By its nature it will always leave a permanent digital trail. If this isn't clearly scary I don't know what scares anymore...
Digital centralized money Versus cryptocurrencies
One of the most important things for a man is to have his freedom and privacy guaranteed. Freedom allows him to do with his money what he wants, the privacy not to be controlled and have his life exposed. When these values are lost there is nothing left to fight for, and this is where real cryptocurrencies matter, this is where the value of freedom has immeasurable value.
Nothing is gained by being monitored, controlled and regulated by a currency that will only rob man's most precious thing: freedom. Centralized digital currencies will simply change the course of 'paper money' and turn it into digital. They will not have a value above what is currently quoted on the market, as they are nationalized and will be in parity of 1:1 with the physical. If the 'digital Yuan' has the value X the value of the digital will also be X.
Cryptocurrencies such as Bitcoin Cash are anti-inflationary as they have a set amount and can never be increased (21 million units total supply) while digital money may well be issued numerous times whenever the government finds it so.
One last note, the Fiat is a trap
The issuance and creation of digital money is a tactic by the government to distract the less informed people, a way to fight the world of cryptocurrencies. Many people will submit to it, it is human nature to follow state propaganda, but in the end they will realize that all their monetary movements will be controlled to an extent never imagined.
While banks today can track banking instruments like credit cards or even bank accounts, the use of government digital money will 'comb' everything.
Cryptocurrencies no, they are the true future of humanity, where men can enjoy their freedom and use their free money from constant control and monitoring. Everyone can control and use their money in a decentralized, fast and secure way, paying convenient fees and not having to pay maintenance fees to keep the money in their accounts.
Don't fall for this mess, digital centralized money is a trap and time will prove it... Freedom matters'!
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I do feel that we have some revolution going on..ordinary people vs those big companies wanting to take control of the cryptocurrencies..some companies/people manipulating the market..gosh..