What Are the Privacy Implications of a Programmable CBDC?
A programmable CBDC raises significant privacy concerns because the central authority could potentially track and control how the money is spent, effectively creating a panopticon of financial activity. While programmability could enforce policy goals, it risks unprecedented surveillance and the potential for financial censorship, fundamentally changing the nature of money and privacy.
Glossar
Privacy
Anonymity ⎊ Privacy within cryptocurrency and derivatives contexts centers on obscuring the link between transaction origins and identifiable entities, a critical distinction from traditional finance’s reliance on Know Your Customer (KYC) protocols.
CBDC
Currency ⎊ Central Bank Digital Currency (CBDC) represents a digital form of a nation's fiat currency, issued and regulated by the central bank, distinct from decentralized cryptocurrencies.