Never has the centralization of a technology been so seductive for those who govern, nor its decentralization so necessary for those who are governed. The Chinese regime was the first to be seduced by the power of cryptocurrencies. This new programmable money will prove to be much more competitive then the traditional one and this time the copycats will be Western countries, still without state-sponsored cryptocurrencies. However, this newcomer will cause a loss of privacy, which may extend to a global scale, even more dramatic than that currently experienced by Chinese citizens.
A more pervasive digital reality will start to be felt from the current pandemic (starting with apps to work remotely and to detect contagions), followed by the adoption of centralized cryptocurrencies by several governments of the planet (starting with the launch of the "digital yuan"). Will the next western state-sponsored “cryptocurrencies” be open to free use by citizens, or will they have controlled access? The answer to this question will reveal whether this new Chinese global export will be purely economic...
On June 12th, 2020, speaking at the US Congress, Republican Tom Emmer explained his lucid vision of a “digital dollar” of free access for all. Considering that the "digital dollar" should have the same attributes as cash, "to be truly free digital money", he began by reaffirming the importance of values ??such as freedom, privacy and openness to entrepreneurship that led the US to dominate global trade and innovation. Emmer then appealed the congressmen to “have the courage to integrate these values ??into a digital dollar and not to copy systems such as China's new digital yuan, closed, centralized and monitored so that their access can be denied and payments blocked by anyone who is in the power".
This strong speech made clear the conviction that the USA should follow an open model in creating a “digital dollar” that can stimulate entrepreneurship and innovation, instead of, on the contrary, opting for a closed model that would originate a “dollar” central supervisory digital system, capable of becoming the key part of a citizen surveillance and control system that would resemble the Chinese case.
We must commend the clairvoyance shown by this American congressman, hoping that Republicans and Democrats will understand the importance of this matter. For the good of Portugal and Europe, it is necessary to demand equal discernment in the old continent.
The current socio-economic situation is too concerning to add to it the dramatic risk of losing our privacy as consumers. Even knowing that the disclosure of personal tastes and preferences on the Internet is now viewed naturally (social networks are very grateful for such relaxation...), it is good that we consider it unacceptable to be held hostage by a digital means of payment that can be programmed by a computer, conditioning our own consumption!
In the election of a digital currency, there are two diametrically opposed political options: choosing “cryptocurrencies” whose use requires authorization (a “permissioned” version) or, choosing “cryptocurrencies” that do not require such permission (a “permissionless” version). Now, state-sponsored digital currencies that may be elected in the so-called “free world”, must be of the second kind, and be traded on open networks, where each one of us can create “private keys” to be able to move them without constraints. Combining digital convenience with the liquidity and privacy characteristic of cash, such free access will catalyze innovation and encourage entrepreneurship. Of course, it’s not all roses, and the reverse of the medal will bring new fraud and more crimes on the Internet, such as “money laundering” and other criminal actions.
As for the second political option, it corresponds, precisely, to the type of state digital currency recently launched in China. As expected, the use of the Chinese “cryptocurrency” requires state permissions, circulating in a “closed” network that can be forbidden to those who do not fall in favor of the regime (in this case, the key to access the coins is only assigned by the authorities). In a way, due to its centralized nature, the Chinese “cryptocurrency” is similar to electronic bank cards, although, in its cryptographic version, money is now much more invasive of citizens' privacy. It is understood that such controlled access and the possibility of knowing everything about the behavior of each consumer, can be very gratifying aspects for the Chinese political regime, but it turns out that the reverse of this new communist medal is even more disturbing than the police cases regarding the free “cryptocurrency” model. In practice, with its centrally planned digital currency, it will be the Chinese regime that decides whether or not each person will be able to pay for everything they want to consume ...
There is no doubt that centralized and state-controlled “cryptocurrencies” emerge as powerful instruments of political repression. While it is true that they can prevent tax evasion and virtually eliminate financial crimes shielded from anonymity, when in the grip of dictators, they serve a new type of “state terrorism”, or even facilitate the establishment of totalitarian governments in a changing world.
In addition to being voters citizens are also consumers, having the legitimate right to choose whether future transactions should require an electronic “made in China” authorization, or whether they should be able to be carried out with free and open currencies. It remains to be seen whether people will be informed and allowed to decide who will be the real owner of their digital future, or if this matter will be dealt with silently...
Dario de Oliveira Rodrigues
