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“CBDCs are the big brother that does not guarantee privacy”

Important facts:
  • Digital assets have value, but there is no widespread consensus about their use, says Boada.

  • The official believes that CBDCs can be a surveillance method like China does.

Central bank digital currencies (CBDC) were discussed as part of the Blockchain Summit Latam 2023 event, which is taking place in Bogotá.

For the executive secretary of the Bank of the Republic of Colombia, Alberto Boada, these assets are a kind of “Big Brother that does not guarantee privacy.”

According to Boada, there are questions about CBDCs that have not yet been answered, including: Are these digital currencies really equivalent to cash? Do they guarantee privacy?

Although he says these questions are not answered, he seems to have a clear opinion on the subject. In his opinion, CBDCs pose a “great danger” because it is possible to know what the user is doing with their money. “Absolutely everything is known, where it is, what it does, it is traceable, how it is spent, etc.,” the Colombian official said.

Instead, he explained Cash is untraceable, no one knows where it is, and it can be used as you wish. With large amounts of money, the rules of money laundering and terrorism protection must be observed, he made it clear.

The official also referred to the digital yuan, China’s CBDC, one of the most advanced digital currency projects of its kind. He assured that It is an instrument of absolute surveillance of Chinese citizens.

In any case, he believes that there is still a long way to go before such an instrument can be implemented in Colombia:

“CBDCs still do not have a specific legal framework. One of the central elements is privacy and anonymity. “This is where they differ from what you do with the ticket.”

Alberto Boada, Secretary of the Board of Directors of the Bank of the Republic of Colombia.

It is in this sense that the director of the financial institution looks at it From a legal perspective, the Colombian Constitution protects the right to privacy and should be appreciated as a fundamental element in this digital age.

At the event, Boada was also asked about Bitcoin (BTC), cryptocurrencies and his position on the matter. “Digital assets are money in the sense that society contractually accepts them as a means of payment and reserves them as an investment or as a unit of account. “So far, this has not been contractually possible,” he said.

Yes OK understand that some cryptocurrencies have valueThe official points out that “there is no general agreement” beyond the contracts that participants have “within the ecosystems that consider it a store of value or a unit of account,” he commented.

“If at some point we see that Bitcoin itself has its price and is non-referential and people do not think of exchanging their Bitcoins for dollars, then we can think that a private, pure and functional currency has been created that contains the elements of payment “, investment and store of value,” says the official, who believes that Bitcoin is still heavily dependent on the dollar.

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