Why CBDCs will fail

new realities.
4 min readMar 17


And may leave billions of people bankrupt

Photo by Dylan Calluy on Unsplash

CBDCs, for a long time, were the pipedream of all government regulators.


CBDCs promised a tightly controlled economy and market.

They promise easy surveillance .

They enable instant freezing and withdrawals for accounts and individuals they find offensive.

CBDCs provide government with an opportunity to introduce new monetary legislation tied to digital identity, category of business and crime records.

CBDCs will install a “global monetary system” which makes it easier for bankers to trade and profit from— but that necessitates reliance upon centralized servers and power systems.

CBDCs are another — and perhaps will be the most potent — way for governments to ringfence the last freedoms of barter and trade.

Right now, billions of people would call this overreach.

Right now, they don’t yet know that this overreach is coming, and that it will make their bankruptcy and destitution a 50/50 possibility, regardless of what number they see in their account and regardless of where they are in the world.

And there’s another catch.

These reasons that government and regulators are racing to introduce CBDCs so badly, are also the reasons that world governments cannot afford for CBDCs to fail.

And fail they will.

There will be no such thing as a secure, safe, or fair CBDC.


No CBDC and no cryptocurrency is completely secure from hackers

The Bitcoin maxis, .eth freaks and decentralization groupies alike will yawn, but they know it’s true. There is no such thing as a completely secure digital currency. And, in the future, there still won’t be — and this is pretty much guaranteed.

Digital wallets are one of the four main points of failure (see the next point for those) for all digital currencies. In context, we are talking about the multiple millions of wallets which are:

Hot wallets (i.e. always online and therefore always accessible).

“See-through” wallets (i.e. usually mobile- or browser- based crypto wallets, like MetaMask, powered by one of very few APIs which, so far, have proved to be injectable and hackable.)

Unsupported mobile phones and hardware (i.e The irrepressible juggernaut that is planned obsolescence, ensures that old phones, laptops and computers with digital wallets and exchange apps on them, will eventually go completely unsupported. The lack of security patching will make wallets in these devices vulnerable to hackers.)

Mobile phone numbers are duplicatable and clonable, which can be used to empty a cryptocurrency or CBDC wallet.

This is already happening.

The big tech companies are slow to their own cloud servers being hacked for crypto operations — and there’s no telling what kind of actors these are (i.e. not all hackers are hostile, and some are state actors). As governments do not create or build their own authentication apps, instead relying on Big Tech, the citizen is reduced to being merely a customer.

Counterfeit apps and dating apps are used to either steal trust or steal crypto — or both. And a trustless, regulated exchange won’t stop this from happening. There is no reason why this will not happen with CBDC apps in the future. Why? Because any major legitimate app and 2FA can still be injected with hacked code.

Governments do not have enough cybersecurity talent to make regulated CBDCs safe from hacking, and they therefore cannot guarantee the safety of such a currency. AI won’t make up for this, as AI can be used maliciously by existing threat actors.

CBDCs leave governments and companies wide open to being hacked themselves with ransomware

Ransomware is a burgeoning problem across the world. Billions of corporate and government devices are lost to ransomware attacks every year, and the number is growing. While, even without knowing much about cybersecurity, you could assume that it is arrogant of governments to think they are immune to this; it is even easier to decipher that any sort of centralized network for digital currency is ripe for a slew of sequenced attacks.

Governments think quantum computing advances will fix this

There is a quiet belief that getting ahead with quantum computing — once it is accessible and affordable to government (we’re a only a decade away) — will make cybersecurity of CBDCs a thing of the past. Tragically, it will only make CBDC encryption easier to hack.

That is why “post quantum cryptography” has become a priority for nations such as the US, China, Japan and the UK.

What’s more, is that no-one is really researching real-world fractional heat control, or how short pulse lasers (or just well-directed lasers, tbf), earthquakes or even just some extra water would clearly render most quantum computing environments at the very least disrupted, and at the very most, utterly destroyed with unintended consequences.

CBDCs have four points of failure, which are:

  1. Human admin — as with any organisation today, the single point of failure in any CBDC operation will be the folks in charge of it (and, a few years from now the AI in charge of it). And, like any mean sysAdmin you dumped in ’03, you might find yourself pwned one day, just because you’re not liked by someone powerful.
  2. Digital wallets — the minute you’re online, you’re a target. Air-gapping only works when, well, you’re air-gapped. Hilariously, cash is air-gapped by default.
  3. CBDC accounts and exchanges — whether the infrastructure for CBDCs are centralized or decentralized won’t really matter. The infrastructure of CBDCs relies on code (and may the lord have mercy if it’s Python), and it relies on hardware.
  4. CBDC hardware — hardware is also built on code, and in order for it to be forced upon a populace, said hardware will need to be online at some point.

Old wisdom tends to be the best.

Nothing good ever came easy, and CBDCs are neither good, nor easy.



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