[Cryptography] Am I missing something about CBDC ?

[John Levine]

In article <23bc1dcbb242e03c63822c45b41ad58e98aed9ad.camel at crypto.16bits.net> you write:
>I don't think there is a clear statement of what it should have or
>solve. In fact, I don't find those “cryptocurrency by banks” approaches
>to be useful. Why would you want to e.g. create a "semi-private
>blockchain between trusted parties"? ...

The CBDC proposals I've seen fall into two groups, neither of which has anything
to do with blockchain other than perhaps as a marketing gimmick.

One lets everyone set up an account directly at the central bank and
do transactions between accounts. It's sort of a universal version of
prepaid debit cards or Venmo or Square Cash. The counterargument is
that Venmo and Square Cash already do a pretty good job of being Venmo
and Square Cash.

The other issues bearer tokens that take the place of physical cash,
and are intended to be at somewhat anonymous like cash is. In such a
scheme I assume they prevent double spending by clearing transactions
through the issuing central bank, although the discussions are rather
confused and many seem to assume that commercial banks somehow act as
intermediaries, which I don't understand unless they all have a like
connection to the central bank.

There is a lot of handwaving.  For example, that smart contracts would
let people do foreign exchange risk free, by linking the payments to
and from the exchange agent.  That is silly.  When I transfer money
through someone like Transferwise, the risk I worry about is not that
Transferwise will default, it's that the actual exchange rate changes
from the one they offer me.

The arguments in favor of CBDC tend not to be technical, more that
commercial banks do a lousy job of providing services to low income
customers, and at least in Europe, it is still stupidly hard to use
bank cards across national boundaries even when both countries use the
Euro.

R's,
John

PS: >(note: this email arrived in a broken form, including a copy of mail
>headers in the body)

Same here for the one you were replying to, yours was OK.