Ethereum’s Creator Questions CBDC Transformation
Vitalik Buterin, one of the co-creators of Ethereum (ETH), recently expressed his concerns regarding the development of central bank digital currencies (CBDCs).
In a recent interview with CNBC, Buterin shared that his initial optimism about CBDCs has waned over time. He had once hoped that CBDCs would embrace blockchain technology, offer transparency and verifiability, and provide a certain level of privacy.
However, as these CBDC projects have progressed, they have lost their original ideals.
Instead of transforming the financial landscape, they appear to be turning into mere extensions of the traditional banking system. Buterin observed that as these projects approach their 1.0 versions, they often end up resembling the existing payment systems, offering little improvement.
Buterin also expressed concerns about the lack of privacy associated with CBDCs. He believes that these digital currencies will enable governments and corporations to closely monitor financial transactions conducted by users, eroding privacy and dismantling existing barriers that protect individuals from intrusive surveillance.
READ MORE: Central American Country to Leverage Bitcoin for Elections
In contrast, Buterin noted that Ethereum, with its transition to a proof-of-stake consensus mechanism, may be better equipped to resist government interference.
He explained that proof-of-stake is more conducive to anonymity and is less susceptible to shutdown attempts compared to the resource-intensive proof-of-work, which relies on significant physical equipment and energy consumption – factors that law enforcement agencies can easily detect.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
