This is an op-ed by Peter Bistoletti, a Bitcoiner who has been living in Sweden since 1971.
Sweden is a terrifying example of a country that destroys financial privacy, wins the war on cash and controls all financial transactions. Sweden has it Eliminate anonymous cash transactions almost completely As a result, the regulators have control over all financial assets. Since at least 1971, when you moved to Sweden, bank assets have to be reported annually to the tax authorities, who can also require documents for all banking transactions. Since 2020, Swedish police have the right by law to access locked iPhones and computers using force.
In such a privacy-averse environment, one must consider Bitcoin as a better alternative.
Introducing the E-Krona
In the early days of bitcoin, one could buy bitcoins anonymously through platforms like LocalBitcoins, which is impossible today. To buy BTC through the majority of platforms accessible now, one has to follow the strict KYC and AML regulations. Sweden Also has no bitcoin ATMs. Swedish banks, politicians and the media have a very hostile attitude towards BTC.
Sweden is now moving towards a national central bank-issued digital currency. Since 2017Sweden’s central bank, Sveriges Riksbank, Source From the Economic Sciences Prize in memory of Alfred Nobel, he was promoting the e-krona as a supplement or alternative to physical cash. Supporters of the e-krona argue that it prevents money laundering and criminal activities, speeds up the financial system and regulates financial and monetary activities. Critics argue that it is the ultimate tool for financial oversight, oversight, and monitoring. The evolution of the e-krona is happening in Cooperation with other central banks and the Bank for International Settlements (BIS).
E-Krona is, at present, a pilot project, testing the technical platform and collaboration of banks, companies and end users. The electronic krona will retain several monetary functions, however no Anonymity. The size of the electronic will generated no It is not determined by mining (as it is for bitcoin), but by a central bank. Positive or negative interest rates will also be set by the central bank. In a deeper sense, the e-krona without a function like bitcoin mining is just a centralized database controlled by the central bank.
Designed to limit freedom
The technical foundations of e-krona are based on some form of blockchain technology through Corda platform, developed by software company R3, and launched a technical demo project in February 2020 in cooperation with Accenture, a large global technology company. The e-krona is programmable and only the central bank can create and destroy the e-krona, which is distributed through banks to the general public. The end user can exchange e-krona for bank money in an account and can carry out and accept transactions.
- “Rexbank node” to create and destroy the E-Krona.
- Riksbank’s “notary knot” to prevent double use of e-krona.
- “Subscribers contract” in banks and payment service providers to verify the validity of the e-krona.
- A “contract for end users” for deposits/withdrawals with the help of digital wallets.
- mobile bank ids, which It has been used in Sweden for many yearswill be necessary for personal identification.
With the e-krona, the Swedish government will be able to see every money transfer made by anyone in real time. It will also be possible to reduce access to e-krona, for example, by social credit score or if one is not compatible with climate change proposals. With the e-krona, the government can freeze a person’s finances and the Swedish state can directly tax customers’ accounts. As evidence of the pretense to motivate spending, a negative interest rate could cause people to lose money in their e-krona accounts and programmable capabilities in e-krona might mean that people are prevented from buying certain goods. There would be many ways to program the e-krona, which opens the way to a dystopian and Orwellian state of control and oversight.
E krona is centralization and central planning as it existed in The banking system of the Soviet Union.
However, central planning never works, and large centralized bureaucracies are often ineffective. Centralized storage of financial information may also be a problem for the authorities. In a cyberattack, the entire network may be disrupted.
On the other hand, Bitcoin provides decentralization. It is much more difficult, perhaps impossible, to attack the Bitcoin network. The Bitcoin network has also become more flexible over time.
We must remain vigilant
However, e-krona can become a competitor to Bitcoin because ordinary people may trust and use e-krona instead of Bitcoin. One of the main purposes of the e-krona is price stability. Bitcoin, at present, has high price volatility. Bitcoin price stability is affected by supply and demand, investor sentiment, trading activities, regulations, and media hype. As of this writing, The latest 60-day estimate for bitcoin’s volatility was 2.48%; While for gold, the historical average volatility has been around 1.2%. And for major currencies, it ranges between 0.5% and 1%..
Financial privacy should be a human right, but central bank digital currencies (CBDCs) and e-krona lead to the destruction of financial privacy and to the centralization of authoritarian state power. Therefore, we have to fight and prevent the creation and use of basic digital currencies and e-krona. The vision of Satoshi Nakamoto, the inventor of Bitcoin, is built on three core values: security, privacy, and decentralization. Bitcoin can provide all of these benefits, which CBDCs and e-krona can never offer to the same extent.
This is a guest post by Peter Bistoletti. The opinions expressed are entirely their own and do not necessarily reflect the opinions of BTC Inc or Bitcoin Magazine.