While the U.S. and China disagree on many things, one area of agreement among the two governments is that a national digital currency cannot be fully anonymous. However, U.S. Federal Reserve Chairman Jerome Powell recently stated that he believes the digital dollar needs to provide greater privacy than China’s planned digital yuan currency. When a nation’s central bank asserts the need for greater privacy for its planned digital coin, you know there is reason for concern.
During his testimony before the House Committee on Financial Services recently, Powell said, “The lack of privacy in the Chinese system is just not something we could do here.” He continued, “We’re only beginning to think carefully about these things and it’s going to be a careful, detailed and probably lengthy process of consideration.”
These comments came after the head of China’s central bank claimed that the digital yuan will provide greater protections of privacy than any other digital platform. The official stated that the digital yuan will have “controllable anonymity” where a private account would only require one’s cell phone number. The reality is that one must provide their ID to a phone carrier to obtain a cell phone number, so privacy is an illusion in China’s planned system. Plus, individuals would be required to provide more personal information when deposits hit a certain threshold.
No elaboration has been provided by the U.S. Federal Reserve, a.k.a. the Fed, on the level of anonymity planned for the digital dollar. There is also no clear timeframe for its launch that has been spelled out yet. Questions remain whether the Fed would host user accounts or if they would sub-contract hosting to a 3rd party. Security risks in the event of a breach are major concerns as these issues are evaluated.
Powell asserted his agreement with U.S. Representative Bill Foster (D-Ill.) who said that an untraceable, anonymous dollar “is not a viable option for our country or free world” due to concerns about potential money laundering or funding terrorism. U.S. Treasury Secretary Janet Yellin has also aired concerns about potential illicit uses of anonymous digital currencies.
The irony is that the printed dollar bill used for over two centuries possesses the ultimate anonymity, yet that has never been a problem for government officials. When individuals engage in private transactions using cash with no documentation, there is no inherent wrong or violation of human or moral law. Whether the transaction is small or large, why should that change the fact that it is no one’s business how individuals conduct their affairs?
This entire topic is reminiscent of how society’s views on morality have changed over the years. In the not too distant past, couples could not share a hotel room unless they provided a marriage certificate to show they are married. There were actually laws on the books in many states that restricted who could marry and to what race. The government was deeply concerned about people’s private lives and what they did behind closed doors until people said enough is enough, and that it is not the government’s business how law-abiding people wish to live their lives.
META 1 Coin Trust believes there will be a time in the very near future where government intrusion in people’s financial lives will lead to a similar crescendo of resistance by society. Honest, hard-working people will eventually be compelled to stand up to governments who attempt to surveil, track and control the financial lives of its people. Until then, META 1 continues to fight back using the legal system to resist the insatiable appetites of government agencies and their mainstream media mouthpieces that try to erode our civil liberties.