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Here's How CBDC Fears Are Fueling Bitcoin's Surge
The Y2K bug never melted the global grid, yet the panic-buying of flashlights and canned beans in the last months of 1999 was very real. Today, central bank digital currencies (CBDCs) could be playing a similar role in a different fear cycle.CBDCs are digital currencies issued and controlled by a central bank, combining the convenience of digital money with the potential for state oversight of transactions. Talk of state-issued, fully traceable (and controllable) digital money has some investors looking for a lifeboat, and the main beneficiary this time could be Bitcoin (CRYPTO: BTC).If you think a large and fearful capital flight to Bitcoin driven by CBDCs is improbable in the near term, you aren't wrong. Nonetheless, it's undeniable that a centralized and government-controlled digital currency could threaten financial privacy in a way that encourages certain investors to hold their funds in another form. There's already some evidence that at least a few people are buying Bitcoin for this reason. Let's dig in and understand this trend a bit more so that you'll be prepared if it continues to take off.Continue reading
The Y2K bug never melted the global grid, yet the panic-buying of flashlights and canned beans in the last months of 1999 was very real. Today, central bank digital currencies (CBDCs) could be playing a similar role in a different fear cycle.
CBDCs are digital currencies issued and controlled by a central bank, combining the convenience of digital money with the potential for state oversight of transactions. Talk of state-issued, fully traceable (and controllable) digital money has some investors looking for a lifeboat, and the main beneficiary this time could be Bitcoin (CRYPTO: BTC).
If you think a large and fearful capital flight to Bitcoin driven by CBDCs is improbable in the near term, you aren't wrong. Nonetheless, it's undeniable that a centralized and government-controlled digital currency could threaten financial privacy in a way that encourages certain investors to hold their funds in another form. There's already some evidence that at least a few people are buying Bitcoin for this reason. Let's dig in and understand this trend a bit more so that you'll be prepared if it continues to take off.
