[Cryptography] Am I missing something about CBDC ?

John Levine johnl at iecc.com
Fri Dec 18 15:45:56 EST 2020

From: John Levine <johnl at iecc.com>
To: cryptography at metzdowd.com
Subject: Re: [Cryptography] Am I missing something about CBDC ?
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In article <AM0PR01MB59052340FEDE5A31C09B5FCEC4C30 at AM0PR01MB5905.eurprd01.prod.exchangelabs.com> you write:
>Turkish Banks already have a system that transfers money (with almost no limit) between accounts from same bank.
>Also you could transfer up to $150-200K worth money in national currency to any other national bank with little to
>none fee during business hours. Now they have upgraded the infrastructure and allows instant transfers between
>accounts from different banks 24/7.
>While that technology exists and already field tested, I doubt that the central banks would want to have a CBDC to
>provide that functionality.

Again, maybe I'm missing something, but a CBDC has nothing to do with transfers among bank accounts.

Here in the US we have ACH interbank transfers which are reliable but
slow, a couple of days, and have limits that vary wildly among banks;
one bank I used to use limited them to $1000/day, another one lets me
send $350,000/day. The Fednow service I mentioned a few messages back
is supposed to make that realtime for transfers up to $20K. None of
this has anything to do with CBDC or bearer tokens. It's ordinary bank
account transfers like Phill described.

Hence my confusion about what problem CBDC is supposed to solve or
what privacy and security features it would have. Depending on who you
ask it's banking for the underbanked (who nonetheless have a smart
phone and reliable mobile data or wifi), or maybe it's an electronic
version of cash for anonymous mostly irrevocable transcations. Or
maybe it's something else.

Read the paper and see if you can figure it out.

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