CBDCs may pose a threat to privacy. The central authority that will be responsible for collecting and distributing identification and transaction data will have access to all monetary transactions. In addition to the threat of central banks disallowing or curbing transactions between citizens, the data could be vulnerable to hacks or misuse, if leaked.
'One of the most fundamental expressions of freedom Americans take for granted is the ability to conduct transactions using cash. The fact that ordinary Americans can settle debts and sell goods using cash may not be fully appreciated until cash is taken away.
" 'The privacy afforded by cash is irreplaceable. Bitcoin and other digital currencies may be difficult to track, but undisclosed Bitcoin accounts are already illegal, and it isn’t hard for authorities to identify who is using virtual servers and other methods of concealment.
" 'The case for cash, however, isn’t that we want to encourage an underground economy. It’s that the existence of cash can at least prevent the arm of government from coming down to even the most petty transactions. Did you use cash to pay your gardener or an occasional babysitter or a handyman? If so, you might decide not to give them a 1099. Did you sell some old utensils, books, CDs, and furniture at a garage sale, and collect cash? If so, you might decide not to get a resale permit to collect sales tax. Once cash is eliminated, those choices will be made for you. Wasn’t that de minimis? It won’t matter.". . .
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