Central Bank Digital Currencies Would Let Governments Control What People Spend Money On: IMF Official Admits

The International Monetary Fund (IMF) has said that central bank digital currencies (CBDCs) could potentially allow a government to control what people spend their hard-earned cash on.

Speaking at the IMF-World Bank annual meeting on Oct. 15, Deputy Managing Director Bo Li said that a CBDC could improve “financial inclusion” through programmability.

“A CBDC can allow government agencies and private sector players to program, to create smart contracts, to allow targeted policy functions,” Li explained.

“For example, welfare payments, for example, consumption coupons, for example, food stamps.”

“By programming CBDC, that money can be precisely targeted for what kind of people can own [CBDC] and for what kind of use this money can be utilized, for example for food.”

Li, who stepped into the role of deputy managing director at the IMF on Aug. 23, 2021, added that by allowing the government to precisely target what people need, this will enable said government to “improve financial inclusion.”

However, his comments were quick to garner a reaction from experts, including Nick Anthony, a policy analyst at the Cato Institute’s Center for Monetary and Financial Alternatives.

Anthony wrote on Twitter that the IMF executive’s comments revealed how a CBDC would “allow the government to precisely control what people can and cannot spend their money on.”READ MORE

Responses