I spent the past week in El Salvador for the third time in one year, and it’s clear the country is undergoing a real transformation. Not theoretical, not surface-level — a shift in how people live, think, build, and imagine their future. And the moment that crystallized this transformation came at the end of the week, during a private dinner with President Nayib Bukele, which I was privileged to take part in.

I’ve followed his work for a few years. I’ve interviewed nine Salvadorans and expats living in the country on my podcast — as well as merchants, builders, grassroots organizers, and everyday citizens. A year ago, I tweeted that my dream was to meet him one day.

I didn’t expect that when I approached him at the end of the dinner to take a photo and said, “Hi, I’m Efrat,” he would answer immediately, before I could explain who I am:
“I know you, I’ve seen your podcast.”

It was one of those moments you don’t forget, because it made the entire week feel connected to something larger unfolding in this country.

The Three Layers of a Nation in Motion

Three events took place during the week — Reclaiming Health, Adopting Bitcoin, and Bitcoin Histórico — each revealing a different layer of El Salvador’s trajectory.

“Reclaiming Health Symposium” led by Salvadoran Dr. Kenneth Fernández-Taylor, explored the intersection of sound health and sound money. Some of the conversations centered on how unsound money and high-time preference shape stress, uncertainty, and long-term health. In a country that has reclaimed public safety and is now reclaiming economic freedom, the connection between health and money didn’t feel abstract, it was intuitive. Four years ago, when the world was gradually going insane during an “end of the world pandemic”,  a health symposium with truth-seeking, freedom-loving doctors, healers, and experts felt like a distant dream. But in El Salvador, dreams are coming true. 

At “Adopting Bitcoin”, I saw the grassroots engine of this transformation. Circular economies like Bitcoin Beach (El Zonte) Berlin in El Salvador, and MurphLife, are real-life demonstrations of what happens when people earn, spend and save in sats. Communities like “Bitcoin Babies”, “Les Femmes Orange” or the Argentinian “La Crypta” emphesize that bitcoin is for everyone. Merchants accept Bitcoin naturally. Kids are growing up around it. “My First Bitcoin” announced its next chapter: supporting 70+ projects across 40 countries with materials, frameworks, and guidance for community-led Bitcoin education. The startup floor was filled with founders who have opened offices here and are building from El Salvador. The common theme I kept hearing was simple: you can do things here.

Historic Moment For Bitcoin & El Salvador

But the highlight of the week, the moment that framed everything else, was “Bitcoin Histórico”. It was the first government-led Bitcoin conference in the world, organized by the government’s Bitcoin Office, a world-first led by Stacy Herbert and team, and held inside the National Palace and the National Theater. These are two very symbolic landmarks, and the decision to host a Bitcoin conference in such royal setting said more than any speech could. The halls were filled with ministers, entreperneurs, and international speakers; voices from the U.S., Europe, Latin America, and Africa. Guests received booklets titled “El Salvador is Bitcoin Country” with Bukele’s photo on the cover, and it is clear that Bitcoin is not a side project here, it is a national direction. 

Outside, in Plaza Gerardo Barrios, the conference spilled into public space; the sessions were screened with Spanish translation to the locals: families, students, elders. Shops and stalls accepted sats. Bitcoin was in its natural habitat, part of everyday life in the city, and the public was part of the conference.

Several announcements underscored the country’s trajectory: The Ministry of Agriculture signed a cooperation agreement with The Beef Initiative to strengthen local cattle production. Steak ’n Shake announced its targeting El Salvador as first Latin American location, accepting  Bitcoin from day one. 

The government unveiled the purchase of Nvidia B300 chips, compute powerful enough to train and run advanced AI models locally, with the support of Hydra Host. It’s a step toward sovereign compute infrastructure that reduces reliance on Big Tech data centers and positions El Salvador to build its own AI capabilities inside the country. Mempool announced it is incorporating in El Salvador, following a recent $17m investment. And with support from Lina Seiche and the Bitcoin Office, 500 classrooms will be renovated for Bitcoin and financial education as part of the country’s wider “Two Schools a Day” initiative to modernize and expand educational infrastructure at scale. Together, these moves form a consistent pattern: a country building its future across multiple layers at once.

Ricardo Salinas’ presence at Histórico added weight to the moment. In his remarks, he said “El Salvador is on the right side of history,” and pointed to the dramatic improvement in public safety: “You have better security than in Japan. I wish my country could be like this.” Coming from one of Latin America’s most influential entrepreneurs, his words echoed what many visitors felt this week.

The Presidential Dinner

But the clearest window into that future came at the dinner.

Bukele is nothing like his international caricature. He’s sharp, fast, funny, and completely fluent in the culture of Bitcoin. As he sat down to the dinner table, he joked, “Guys, it’s over, Bitcoin’s done,” because the price had dipped under $100k that day. He’s not a politician trying to sound relatable or quote scripted talking points; he actually understands the room and gets bitcoin.

When the conversation turned to Bitcoin’s long-term trajectory, he said something that stayed with me: “Bitcoin should be a currency.”

Not an investment, not an asset class, a currency. He sees the end state clearly. And he sees the steps that lead there. He talked about circular economies – El Zonte, Berlin – as a practical mechanism for adoption. Communities that use Bitcoin daily are the ones that will carry it from an idea into a functioning monetary system.

His wit revealed just as much as his analysis. Giacomo Zucco, Director of Plan B Network, was introduced as an anarcho-capitalist, and Bukele immediately replied, “It’s fine, I’m also friends with Milei,” then called him “the anarchist” throughout dinner. After Wiz gifted him a katana (a Japanese sword) and Giacomo gifted him a bottle of rum named “Dictador” (a light jab at the media narrative) someone noted that Bukele doesn’t drink. He answered instantly: “It’s fine, I don’t often fight with swords either.”

As the evening ended, Giacomo thanked him, and Bukele smiled and said something that summed up his entire approach to governance: “I’m sorry if I run a government. But it’s a very small one.”

Happy People Whistle

I’ve spent time in many countries that are drifting toward a darker trajectory; more surveillance, more centralization, more control, more violence. What’s happening in El Salvador feels like the opposite: safety without oppression, structure without suffocation, freedom with responsibility. After decades of oppression by violent gangs, Salvadorans feel liberated. You can see it in their faces, they’re kind, relaxed and grateful. On a previous trip, I saw a 75-year-old man cycling through El Zonte at sunrise, whistling. “When do people whistle?” I asked myself. “Happy people whistle. People whistle when they feel safe”. That simple moment became my quiet metaphor for this place. 

Yes, the country still interfaces with global institutions such as the IMF. The recent repeal of bitcoin as a legal tender was unfortunate, but after peeking under the hood, it feels like one step back, four steps forward. Indeed progress is uneven. But the direction is unmistakable: a push toward monetary sovereignty, digital sovereignty, educational sovereignty, and civic sovereignty, all moving in the same direction.

This week gifted me with a glimpse into a nation rebuilding itself.

While most other nations struggle with their economy, security, frail social fabric under the influence of global agendas, El Salvador is transforming its reality, moving into a new timeline.
And meeting Bukele didn’t feel like meeting a president.

It felt like meeting the architect of a country determined to liberate itself and lead the way.

This is a guest post by Efrat Fenigson. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine. 

This post El Salvador: The Making of a Sovereign Nation first appeared on Bitcoin Magazine and is written by Efrat Fenigson.

For a while, I was skeptical of bitcoin treasuries. All these bitcoin companies felt like another fiat-financial stunt, another way to play games with debt and derivatives while co-opting Bitcoin’s name. I didn’t want bitcoin financialized. I wanted it to flourish — cleanly, directly and outside the grasp of Wall Street.

But then I sat down for a conversation with Preston Pysh on my podcast “You’re the Voice.” That conversation changed everything for me.

Preston’s background is as unorthodox as his insight: an Apache helicopter pilot turned engineer and venture investor. And when he explained how bitcoin treasury companies function — not just structurally, but systemically — something clicked.

He called them “super spreaders of adoption.” And he didn’t mean that in a flashy, memetic way. He meant that these public companies are engineering themselves to bring bitcoin into the deepest corners of capital markets: pensions, retirement portfolios, bond funds. Through public transparency and financial engineering, they’re creating vehicles that allow bitcoin to seep into legacy systems — not by smashing the door down, but by flowing through the cracks.

“When you securitize Bitcoin through a public company, you’re creating a vehicle that can operate in the fiat world while accumulating sound money in the background,” Preston told me.

So, that’s how bitcoin infiltrates the fiat world…? Not through a revolution, but through clever replication. Or as Friedrich Hayek once put it: through a sly, roundabout way.

At first, I still hesitated: Isn’t that just more fiat games? Isn’t bitcoin supposed to be the exit?

So I pressed Preston: What’s the product here? What are these bitcoin treasuries actually offering? Do they even have a product or a service — or is bitcoin itself on the balance sheet enough?

His answer surprised me. The product, he said, is yield — and the demand for it is massive. The market isn’t just hungry for high-yield instruments — it’s desperate.

“The product is the desperation: retirees need high-yield income.”

It’s a tough truth, but it reflects the sad reality of fiat-based economies. We didn’t create this broken system — we’re living in it. And for millions of people trying to preserve their wealth, bitcoin treasury companies may actually be a lifeline. Especially pensioners, retirees and institutions trying to escape the erosion of fiat-denominated bonds. That’s the bridge: offer something familiar — a reliable income stream — while quietly onboarding the world to something revolutionary: Bitcoin.

As uncomfortable as that is — especially for people like Preston or me, who’ve dedicated years to Bitcoin education — it’s a needed reality check. If we’re serious about driving adoption, we have to meet people where they are. Sometimes, the bridge to Bitcoin is built from the tools of the old world.

But then he broke it down in systems terms — with Michael Saylor’s “multi-gear transmission” model as a case study. When credit is loose, raise debt to buy bitcoin. When credit tightens, use operating cash or issue equity. Always stack. Always adapt. Always keep accumulating. It’s not just about holding BTC — it’s about designing capital structures that serve Bitcoin, not the other way around.

A lightbulb went off. Maybe this isn’t the financialization of Bitcoin.

Maybe it’s the Bitcoinization of finance.

I think the idea that is shifting my perspective is this: transparency. This “super spreader” effect can only happen in public markets because of their regulatory visibility. You can’t hide what you’re doing. Auditors, investors, the public — everyone can see your books. That makes it harder to play scammy games and easier for Bitcoin’s incorruptible properties to shine through. As I told Preston in our chat, maybe that’s how Bitcoin ends up making fiat markets more honest.

Preston went further. He explained that one of the biggest untapped markets for Bitcoin treasury companies is retirees. People who want fixed income. Bonds. Yield. And through products like Strategy’s STRC security, companies are now offering bitcoin-backed yield instruments that can compete with traditional bonds — and maybe outperform them. That’s how bitcoin reaches even the most conservative portfolios.

“Saylor built a machine that shifts gears depending on liquidity in the system. It’s a genius piece of financial engineering that other public companies can copy — and they will.”

I’ve never been a fan of the idea that real change can come from within a broken system. But I also want to stay open to the possibility that this time might be different — that the fiat system won’t be overthrown in a single moment, but gradually transformed as better alternatives are quietly built inside it, until the change becomes undeniable.

Maybe we’re watching that unfold right now, in slow motion.

“To hand off the baton from legacy finance to the future Bitcoin system,” Pysh said, “the systems have to match frequency.”

That’s where stablecoins come in. Preston doesn’t romanticize them. He sees their flaws. But he also sees their role: to synchronize with Bitcoin, so the transition doesn’t break the relay. They’re the halfway step. A necessary bridge.

By 2030, he predicts, we’ll be living in a world with both CBDCs and bitcoin — a dual system. But not for long. “By 2030,” he said, “merchants will say, ‘We only want the Bitcoin.’”

The world is shifting. The Great Monetary Reset is already happening — beneath the headlines, inside balance sheets, behind cap tables. And maybe that’s the most radical part… It’s not a revolution on the streets: It’s a quiet, strategic rewiring of capital allocation.

I now get how bitcoin treasury companies aren’t the problem. Sure — if they don’t play smart, they may crash. If people go “all in” on them without hedging themselves, they may crash too. But these companies are fulfilling a role meant to be fulfilled: the role of super spreaders. And it might just lead us to the solution. Not perfectly. Not ideologically. But effectively.

The Great Monetary Reset isn’t ahead of us; it’s here — embedded in how capital is allocated, structured and stored. And if Preston is right, the playbook is already written for those ready to act.

This post How Preston Pysh Changed My Mind on Bitcoin Treasuries first appeared on Bitcoin Magazine and is written by Efrat Fenigson.

On April 1st, at the KPMG offices in Tel Aviv, several dozen people gathered for a meeting of the “CBDC IL Forum” to hear representatives from academia, the Bank of Israel, and KPMG present findings from a study conducted by the Bank of Israel through “Roschink” research institute. The study included around 1,000 participants, and the results were published on the Bank of Israel’s website. In this article, I will review key points from the meeting, comment on the research published by the Bank of Israel, and share what I had said to attendees at the end of the forum meeting.

Study: The Israeli Public’s Willingness to Adopt a Digital Shekel

Dr. Nir Yaacobi from the Digital Shekel team at the Bank of Israel shared that participants in the study were randomly selected and represent all population segments. “The research institute works with these individuals, and they are paid for their participation,” he said. The amount paid was not disclosed. Prof. Ruth Plato-Shinar, one of the study’s authors, mentioned that the questionnaires were in a digital format. She noted that even people with very basic phones could participate, but acknowledged that those without any digital access likely did not participate and probably don’t understand what a digital shekel is.

Analysis of the study document reveals several methodological issues:

1. Sampling method: An online panel was used, meaning participants were already enrolled in digital survey platforms—potentially biasing the sample toward tech-savvy individuals and skewing attitudes about a digital currency.
2. Sample representation: The random sampling underrepresented certain groups, especially Arab citizens. Reweighting was used to correct this by doubling responses of some participants, potentially compromising authenticity.
3. Risks such as loss of privacy, government overreach, and impact on cash economies may be underrepresented due to a bias toward digitally-inclined respondents.
4. Participant dropout: 115 participants dropped out between the first and second questionnaires, which may indicate a selection bias—those more interested in the topic stayed on.

Despite efforts to ensure a representative sample, these methodological limitations may affect the study’s validity.

Avoiding Disclosure of Digital Shekel Risks

At the end of the meeting, I spoke critically about the partial and mainly positive information presented to study participants and the CBDC IL Forum attendees. The public wasn’t exposed to potential risks and limitations of such a system, which I’ve elaborated on in many of my keynote speeches, articles and podcasts.

The following video shows that the way the digital shekel was presented to study participants was lacking. The description of the digital shekel and its system focused on the advantages, as read by Prof. Plato-Shinar at the CBDC IL forum meeting:

In addition, the study does not comprehensively address potential risks for end users—such as the possibility of state control over financial behavior, loss of privacy, asset seizure, use of the currency as a surveillance tool, restricted access to funds due to regulatory decisions, and more. The lack of emphasis on these risks is especially problematic for individuals concerned about government overreach and privacy violations, but also for those who are simply unaware of the potential dangers and their implications.

The study does mention:

• Limited privacy claims: It is stated that “the central bank will not have access to identified information about balances and transactions in users’ wallets,” but also that privacy levels will be defined according to user type—which implies that privacy is not absolute.
• Enforcement capabilities and restrictions: “The system will support the implementation and enforcement of restrictions” on wallet balances, which could indicate the potential for usage limitations. The digital shekel is being designed with technical capabilities to impose limits on wallet balances—meaning it will be possible to define how much money a person is allowed to hold in their digital wallet and monitor that in real time. Although the document does not specify who would be authorized to enforce these limitations, the mere existence of enforcement capabilities indicates a control mechanism that could theoretically allow freezes, blocks, or other restrictions on usage—raising questions about financial freedom, privacy, and institutional power.
• Government control: The Bank of Israel will be “the sole authority empowered to issue and redeem the digital shekel,” meaning there will be no decentralized alternatives like cryptocurrencies such as Bitcoin.

Implications for Cash-Based Communities

The study does refer to the level of interest among different population groups and notes that among the ultra-Orthodox community, interest in the digital shekel is among the lowest. However, it does not explicitly discuss the consequences of transitioning to a digital currency for communities that rely heavily on cash. The digital shekel may pose a significant challenge to these groups if cash usage is eventually curtailed.

Possible reasons for low interest among the Haredi (ultra-Orthodox) community:

• Clear preference for cash: Most Haredim use cash due to privacy concerns, a desire to avoid dependence on banks, and some hold traditional opposition to modern financial systems.
• Digital literacy gaps: Financial digital literacy in parts of the ultra-Orthodox community is lower than the general population.
• Fear of regulatory control: Cash offers a degree of economic independence, whereas a digital shekel may increase government control over payments.

Senior Citizens

In 2023, the Israeli Internet Society conducted a survey among Israelis aged 65 and older. It found that approximately 30% do not use the internet at all, and “it can be said that at least some of them have not bridged the access gap.” This population segment (60+) comprises around 25.3% of Israel’s total population (data from 2020). This is another example of a group whose access to technology is limited—and therefore will likely also be limited in their ability to use a digital shekel.

Since the study was conducted digitally, that 30% segment of this population likely was not represented in the sample. That said, only 13% of the study participants were aged 60+ (13% in the first survey and 12% in the second), meaning people aged 60 and over were underrepresented in the sample—at about half their proportion in the general population.

This raises several concerns:

• Digital exclusion: A significant portion of those aged 65+ simply could not participate in the survey.
• Overestimated tech readiness: If only elderly people with digital skills participated, the study may overestimate interest among the elderly.
• Accessibility gaps: People who struggle with technology may also struggle to use the digital shekel—but their perspectives were not captured.

All of these factors may introduce bias that should be taken into account when interpreting the findings. To achieve a more accurate picture, the researchers could have incorporated other research methods (such as phone or in-person interviews) to reach those without digital access.

What’s New in the World of CBDCs

At the meeting, Ben Benakot of KPMG Israel presented developments in the CBDC space. He noted that most countries in the world are exploring CBDC solutions at various stages, and that 65 countries are in advanced research stages.

One case study he presented was Brazil, where the central bank launched the PIX retail payment system during the COVID-19 period. It saw rapid adoption. Today, Brazil’s central bank is working on DREX, a wholesale CBDC system, and has completed a collaboration with Meta to enable payments via WhatsApp using PIX.

Ben pointed out that no advanced Western countries have launched CBDC systems yet—likely one reason the Bank of Israel is not rushing to make a decision. The Bank of Israel has previously stated it is monitoring the EU central bank as a model.

Balancing the Narrative on the EU and China

In my closing statements at the CBDC IL forum meeting, I also referred to a study conducted recently in the EU with less than flattering results; This study was clearly not mentioned by any of the forum’s experts. I found it important to balance the overly positive narrative and bring the following to attendees’ attention:

On March 12, the European Central Bank (ECB) published a working paper titled “Consumer Attitudes Toward CBDC,” surveying approximately 19,000 respondents across 11 Eurozone countries. The report highlighted significant communication challenges that are expected to hinder adoption of the digital euro. It found that Europeans show little interest in a digital euro, strongly prefer existing payment methods, and see no real added value in a new payment system given the many alternatives.

Nevertheless, the European Central Bank recently announced that it will begin the rollout of the digital euro in October 2025, pending regulatory approvals.

Read more about the EU’s CBDC plans in my recent article, ECB Prepping the Ground for Digital Euro Launch.

Furthermore (at the CBDC IL meeting), I went on to explain that the high adoption rate of the CBDC in China is not necessarily a result of public enthusiasm, but rather of a top-down market strategy led by the central bank—a “If you can’t beat them, join them” approach. In the early years of the e-CNY (China’s CBDC), the project was considered a failure due to low adoption. Eventually, the central bank instructed major retail and tech companies to integrate e-CNY into their most popular apps (DiDi, Meituan, Ctrip, WeChat Pay, and Alipay)—a move that enabled wide adoption. Today, the e-CNY has about 180 million digital wallet users and a cumulative transaction volume of $1 trillion.

The Trust Factor

70% of Israel’s study participants expressed trust in the Bank of Israel. At the meeting, Ben Benakot of KPMG commented on the trust issue: “If we don’t trust the government, this becomes a problematic issue, because theoretically, CBDCs give the state more data.” Benakot noted that although the Bank of Israel is designing the system so that it won’t have direct access to user information—only authorized payment providers will—there’s no guarantee that a future government won’t change the system and gain direct access to accounts and personal data.

He also mentioned that today, for example, the Israeli tax authority already has the ability to monitor financial data on citizens (albeit not immediately or directly due to oversight). In theory, the digital shekel is not very different.

Public Awareness and Messaging

Another point I raised at the meeting was the Bank of Israel’s responsibility to inform the public in a fair, honest, and balanced way. I asked: if the Bank truly seeks to understand the public’s willingness to adopt the digital shekel—why hasn’t it launched a nationwide campaign like it did during Covid-19, when the government mobilized all its resources to educate the public through experts, influencers, media, social platforms, billboards, and more?

Why, unlike during Covid, isn’t the Bank of Israel making an effort to present the full picture—including the risks and downsides—not just the flattering, positive aspects?

As someone with about 20 years of experience in marketing, I also pointed out the haste with which the Bank moved from releasing the study and press announcement, to publishing a post the very next day (!) on social media (Instagram, Facebook) stating: “51% of the public wants a digital shekel.”

Every beginner marketer knows that when you highlight the yes, you obscure the no. Yes, there’s interest—but what about the other 49%?

The post read: “Most of the public sees the benefits: easy to use, convenient, and protected from fraud.” Most of the public? Based on a 1,000-person study where 51% expressed interest?

It also states: “No final decision has been made, but it seems the future is already here.” That sounds like the decision’s already been made—only the launch date is missing.

Conclusion

Dr. Nir Yaacobi from the Bank of Israel’s Digital Shekel team said at the meeting: “We’re entering uncharted territory, and we don’t currently have a strategy”—referring to which digital financial solution will be chosen in Israel.

“We’re working on three fronts: a digital shekel (CBDC), stablecoins, and tokenized commercial bank deposits.” He added: “Maybe we’ll go with one solution—like the digital shekel—or maybe all three. If we launch a wholesale CBDC, legislation likely won’t be needed. If it’s retail—yes.”

After I finished my remarks, Assaf David-Margalit from the Digital Shekel team responded and said that some of what I said was accurate—but most of it was not. When I asked what wasn’t accurate, I received no response. My invitation to Mr. David-Margalit to respond with specific clarifications remains open.

To conclude: I believe it is vital to raise public awareness around the digital shekel, because clearly “the future is already here.” For that reason, it is essential to openly present both the risks and benefits of a digital shekel system so that an informed public can participate meaningfully in the conversation and make relevant choices about their lives.

This is a guest post by Efrat Fenigson. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

This post Israel’s New Study Shows 51% of Public is Interested in Adopting CBDC (Digital Shekel) – Is That So? first appeared on Bitcoin Magazine and is written by Efrat Fenigson.

The European Central Bank (ECB) is laying the groundwork for the probable launch of its wholesale and retail central bank digital currency (CBDC), the Digital Euro. Christine Lagarde, President of the ECB, shared this update at their latest press conference. “President Lagarde stressed that the digital euro is ‘more relevant than ever,'” the ECB tweeted.

Lagarde emphasized that the Digital Euro, the EU’s CBDC solution, is set to launch in October 2025—provided it passes the legislative phase involving key stakeholders, including the European Commission, Parliament, and Council. Notably absent from this process is the European public, despite the significant impact this initiative will have on their daily lives.

Why Is the Digital Euro More Relevant Than Ever?

Could it be linked to Ursula von der Leyen’s recent “ReArm Europe” announcement, which proposes the creation of an EU army? This initiative requires an estimated €800 billion in funding—money the EU does not have. The options? Extracting it from EU member states and their citizens or printing fresh funds via the ECB. Either way, it’s time to warm up the ECB’s money printers!

Furthermore, The EU has introduced the “Savings and Investments Union”, aiming to redirect €10 trillion in “unused savings” from citizens to finance military growth and bolster Europe’s defense industry. “We’ll turn private savings into much-needed investment,” tweeted von der Leyen. If this hasn’t shocked you already, I’ll try to clarify: This is a clear violation of private property rights, and an implicit confiscation of Europeans’ wealth, while bluntly using their funds as the EU sees fit, including funding of a military industrial complex, without even asking them.
If the EU is accelerating toward totalitarian collectivism, as this statement suggests, then a CBDC would be a powerful tool—enabling tighter control over Europeans’ money with features like an “on/off” switch and programming abilities.

Christine Lagarde recently campaigned at the European Parliament, arguing that the Digital Euro is necessary to reduce the EU’s dependence on foreign payment solutions. European banks must innovate payment methods, but the EU’s primary concern isn’t just reliance on tech giants like Google Pay or Apple Pay—it’s the potential for widespread adoption of decentralized global protocols like Bitcoin.

The ECB is observing geopolitical trends, noting that the U.S. is embracing crypto, Bitcoin, and stablecoins—technologies that pose a risk to centralized control. Unsurprisingly, they are choosing a different path. According to Reuters, “Eurozone banks need a digital euro to respond to U.S. President Donald Trump’s push to promote stablecoins” as part of a broader crypto strategy. ECB board member Piero Cipollone reinforced this stance, stating, “This solution further disintermediates banks as they lose fees, they lose clients… That’s why we need a digital euro.”

Bottom line, Lagarde’s and Von der Leyen’s recent agendas are aimed to drive more centralised control while strengthening the EU hierarchy, governance and incentive structure – that has always been their role.

New Digital Euro CBDC Survey

The ECB recently published findings from a survey on consumer attitudes toward retail CBDC, conducted among 19,000 Europeans across 11 Eurozone countries. Key takeaways include:

1) Lack of Interest – Most Europeans are not interested in the Digital Euro, as existing payment methods already serve their needs well.

2) Europeans are Open to Propaganda – While public interest is low, the survey found that Europeans are receptive to video-based education and training. The ECB’s study suggests that CBDC-related videos could drive widespread adoption by reshaping consumer beliefs. The report states: “Consumers who are shown a short video providing concise and clear communication about the key features of the digital euro are substantially more likely to update their beliefs… which increases their immediate likelihood of adopting it.” No wonder the ECB has ramped up its digital euro video content since late 2024. For example:

3) Preference for Existing Payment Methods – “Europeans have a strong preference for existing payment methods and see no real benefit in a new type of payment system”. While this finding sounds like a positive pushback, it can serve as a precursor to a tactic of technological integrations. “If you can’t beat them, join them” tactic – similarly to the Chinese e-CNY retail CBDC. 

A recent Euromoney article highlighted e-CNY’s integration with China’s most popular apps (DiDi, Meituan, Ctrip, WeChat Pay, and Alipay), a move that facilitated its widespread adoption. Despite early struggles, e-CNY now boasts 180 million personal wallet users and a cumulative transaction value of $1 trillion. I recently explored this topic in depth with Roger Huang recently on my podcast. 

Not Just Retail—Wholesale Too

On the wholesale CBDC front, the EU is experimenting with distributed ledger technology (DLT) to interconnect financial institutions across Europe and beyond. This follows exploratory work conducted by the Eurosystem between May and November 2024. Their trials involved 64 participants—including central banks, financial market players, and DLT platform operators—conducting over 50 experiments.

“Digital Cash“

Lagarde insists that the Digital Euro is a form of cash, gaslighting and misleading uninformed Europeans about the risks of CBDCs. Permission-based CBDCs such as the Digital Euro are prone to micro levels of control through expiry dates, geofencing and programmability. If Europeans don’t recognize these dangers, they won’t resist the Digital Euro. By framing it as “digital cash,” the ECB ensures smoother public acceptance with little to no public fuss. 

To be clear, cash itself is fiat currency—centrally controlled, easily debased, and prone to inflation. Every time the issuer expands the money supply, citizens suffer from declining purchasing power, essentially being robbed by the state.

“Rules for Thee, But Not for Me”

While ordinary citizens are bound by the rule of law, elites often evade consequences. A prime example is Christine Lagarde, who was found guilty of negligence for approving a massive taxpayer-funded payout to controversial French businessman Bernard Tapie. However, she avoided a jail sentence. The Guardian reported in 2016: “A French court convicted the head of the International Monetary Fund and former government minister, who had faced a €15,000 fine and up to a year in prison. But it decided she should not be punished, and that the conviction would not constitute a criminal record. … The IMF gave her its full support.”

My Prediction for the EU’s CBDC

Despite public disinterest, the ECB (and other central banks) will push forward with their CBDCs. To maintain the illusion of public involvement, they will conduct surveys and create engagement tools. But ultimately, the Digital Euro will be integrated into existing payment methods and consumer apps—just as China did with e-CNY. This strategy will drive adoption even without direct public enthusiasm.

We are, after all, playing the game of “democracy,” right?

Geopolitical analyst Alex Krainer recently tweeted in response to Lagarde and von der Leyen’s acceleration of CBDC efforts: “This is excellent news; Christine Lagarde and Ursula von der Leyen never took on something they didn’t completely mess up. I hope they’ll continue with their excellent performance. Godspeed.”

Stay tuned as I continue to track central banks’ moves toward CBDC implementation.

This is a guest post by Efrat Fenigson. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

This post ECB Prepping the Ground for Digital Euro Launch first appeared on Bitcoin Magazine and is written by Efrat Fenigson.

A few days ago, a new initiative promoted by Prime Minister Netanyahu was announced – removing 200 shekel bills from circulation, as a first step to abolish cash altogether within a few years.

The official excuse? fighting financial crimes and black money in the Arab society. (For those who aren’t aware, 1.6m citizens in Israel are Arab, which stands for 17% of the country’s population).

As expected, this move – identical to India’s move in 2016 – will cause further destabilisation of Israel’s economy and of its citizens’ physical and mental states. A derivative of this economical shake up will ripple into Gaza who is relying on the Israeli shekel as its currency, and clearly, its population is heavily reliant on cash.

So let’s break it down.

Abolishing 200 shekel notes

The value of the Israeli 200 shekel bills surpasses 100 billion shekels, and make up nearly 80% of the bank notes held by the public. In recent attempts to smear cash holders, it was reported that “most of the 200 shekel bills are not used for purchases, but for the accumulation of black capital.” A team of so called experts: nine businessmen and former officials in the public sector, who initiated the idea to abolish these bills, claim that the bills’ removal will recover more than 20 billion shekels ($5.3b) by next year, and 110 billion shekels ($29b) in the next 5 years – bringing it back to the state, and will force tax evaders to be revealed.

Two weeks ago, the first mainstream media article about this new initiative popped up, to normalize and prepare people for this draconian measure.

The proposed policy document suggests several steps to combat black capital:

1. Removing the 200 shekel bills from circulation, as well as broadening the obligation to report on cash holding to the authorities. This is part of a larger plan to abolish cash completely in 3 phases: 1- limit cash transactions to 3,000 shekels ($800) within 2-3 years, 2- lower transaction amount to 2,000 shekels ($530), 3- cancel cash usage completely, while encouraging digital payment methods.
2. Leveraging AI tools for monitoring and enforcing tax evasion,
3. Launching a collaborative enforcement effort that includes various key bodies, such as the Tax Authority, the Anti-Money Laundering Authority, the police, the prosecutor’s office and the Counter-Terrorism Economic Warfare Headquarters.
4. Banning the possession of cash substitutes, such as gold, silver, medals, and coins, on a significant scale.
5. Enhancing regulation of non-banking financial entities, including currency exchange services, which manage significant volumes of illicit funds.
6. Seizure of digital currencies linked to terrorist activities of sanctioned entities – “There are technologies that enable the real-time identification of such money transfers, and Israel needs to implement them immediately. This will allow for disrupting the flow of funds for terrorism and crime, identifying terrorist operatives, and seizing hundreds of millions of dollars for the state, potentially billions in the future”. (This part is from a leaked draft of the plan dated March 2024; it did not appear in mainstream media publications – E.F)

Lo and behold, two weeks after the first “suggestion” of this new policy, Prime Minister Netanyahu announced he’s now advancing this reform urgently in order to fight black capital, especially amongst the Arab population, and called in a special committee to discuss the new policy.

Israel already introduced a new “big brother” regulation last year, for pre-approving any B2B transaction with the Tax Authority, over 25K shekels. The new policy plan now proposes lowering the threshold for transactions requiring pre-approval from the Tax Authority from 25K shekels ($6,750) to 5K shekels ($1,350), a highly controversial move.

Israel’s largest mainstream publication, Ynet, reminded its readers that “Similar steps have been implemented in other countries. In parts of China, the use of cash has been completely banned in certain cities.” Israel’s governing bodies love using “other countries are doing it already too” excuse to justify their acts. The same mantra is being played again and again when the Digital Shekel is mentioned. I recently listened to a podcast with Israel’s Central Bank governor which mentioned favorably how advanced the ECB is with the Digital Euro, for example.

I asked Roger Huang, an author and a journalist, about the accuracy of this statement re. China’s cashless cities: “China’s central bank actually makes it illegal to not accept cash as a payment option and has punished businesses (http://www.xinhuanet.com/english/2021-01/21/c_139687310.htm) in the past for doing so, even during COVID. This is in direct contradiction to a statement justifying restrictions on cash in Israel that certain cities ban the use of cash. This has not been reported, and with no primary source verified, hard to prove. The Chinese central bank’s actions suggest the opposite. Though China is going more cashless and is the most aggressive country at advancing a CBDC/central bank digital currency (the e-CNY/digital yuan), it has not implemented bans or restrictions on using cash – and in fact its central bank punishes those that restrict the use of cash.”

• Israel’s is promoting an initiative to abolish the 200 shekel bank notes as a first step to narrow use of & abolishing cash. Same as in India in 2016.

• Physical gold & silver may be forbidden to hold.

• Gaza’s population suffering from financial oppression via lower… pic.twitter.com/XUbCUKDgFE

— Efrat Fenigson (@efenigson) September 22, 2024

My video on the new 200 bills plan went viral with 70K views, share it here

India removed 500 & 1000 Rupee bills in 2016

In November 2016, the Indian government made a similar decision to the one Israel is now considering, by withdrawing 500 and 1000 Rupee notes from circulation. In the aftermath of this decision, hundreds of people lost their lives, many more faced hardship, and the country’s GDP took a significant hit.

From this 2016 article on Vox:

“Tens of thousands of people have taken to the streets of cities throughout India to protest an economic policy you probably haven’t heard of before: demonetization.

Three weeks ago, Indian Prime Minister Narendra Modi surprised his country with an announcement banning 500- and 1,000-rupee notes — worth about $7 and $15 respectively — in a bid to tackle corruption and terrorism.

He estimated that forcing people to exchange the country’s largest currency bills for new banknotes would allow the government to crack down on “black money” — unaccounted-for cash holdings that haven’t been taxed but, under the law, should be. He also argued that it would strike at domestic terrorist financing operations by capturing counterfeit money and rendering the legitimate cash they kept in the shadows worthless.

Banning widely used banknotes would have a huge impact on any economy, but in India the policy is transformative. Modi’s sudden ban instantly meant that 86 percent of all the cash in
circulation in India was no longer considered legal tender, which means that businesses could refuse to accept those bills as a form of payment. And the Indian economy simply runs on cash: It’s estimated that between 90 and 98 percent of all transactions in India, measured in terms of volume, involve it.

Unsurprisingly, Modi’s demonetization initiative has caused chaos across the country. People want new banknotes, but the current supply of them isn’t close to meeting demand. That’s created headaches for people as they wait in long lines outside ATMs and banks, which routinely run out of cash. For people who rely on daily cash earnings to survive, it can mean not being able to obtain food.”

In this excellent lecture by Andreas Antonopoulos, a famous Bitcoin developer and lecturer, dating back to 2016, Andreas discusses the currency war of countries. He details the cash crisis in India and other examples of countries where citizens are punished due to failed currencies (Venezuela, Argentina, Ukraine, Turkey and more).

All of these trials conducted in one country, serve as testing grounds for future implementations elsewhere (such as the 2012 bank deposit confiscations in Cyprus or efforts to protect banks from collapse in the U.S. over the years). As debt continues to rise, the economic situation deteriorates, and inflation worsens, these experiments will only speed up. We can expect more taxes, further restrictions on cash, more confiscations, and rising prices alongside inflation. Eventually, this deteriorating state will provide a sufficient justification to introduce a new digital control system known as the CBDC, if another “crisis” or “emergency” doesn’t precede it.

Additional cash restrictions in Israel

Israel’s government has been tightening its policy on cash usage in recent years; Today, there are still no official restrictions on the amount of cash that can be kept at home, but the government has repeatedly emphasized that it does not view this practice favorably and prefers that as many transactions as possible be conducted through non-cash payment and money management methods. At the same time, the government is working to advance legislation that would make it illegal to hold more than 200,000 shekels in cash. Additionally, holding cash amounts of 50,000 shekels or more would require providing explanations to the authorities about the source of the money and its intended use.

In August 2022, Israel announced it forbids cash purchases larger than 6,000 shekels. This reform aims, according to a statement issued by Israel’s Tax Authority, to fight organized crime, money laundering and tax non-compliance.

The Jerusalem Post reported back in 2022:

Under the new law, any payment to a business above 6,000 NIS ($1,700) must be made using alternative methods, such as a digital transfer or a debit card. Trading between private citizens who are not listed as business owners will be limited to 15,000 NIS ($4,360) in cash. This is another step in Israel’s fight against the use of cash. Previously, cash up to the amount of 11,000 NIS ($3,200) could be used in business deals.

“We want the public to reduce the use of cash money,” adv. Tamar Bracha, who is in charge of executing the law on behalf of Israel’s Tax Authority, told The Media Line. “The goal is to reduce cash fluidity in the market, mainly because crime organizations tend to rely on cash. By limiting the use of it, criminal activity is much harder to carry out.”

“The goal is to reduce cash fluidity in the market, mainly because crime organizations tend to rely on cash” — Adv. Tamar Bracha, Israel’s Tax Authority, 2022

Gaza’s state of cash

The cash shortage in Gaza has intensified the already dire conditions, making it even harder for people to buy essential food and supplies.

In Gaza, the scarcity isn’t limited to food, water, and electricity. Almost a year into the conflict, there’s a severe shortage of cash. Banks have been destroyed, and frequent power outages have rendered ATMs inoperable. Reports from the region highlight how this lack of cash is worsening the daily struggle for survival, while raids by the IDF on Hamas outposts have uncovered millions of shekels and large sums of U.S. dollars stored there.

Cleaning with soap and water and returning to customers: Gaza’s worn banknote crisis

As reported on Ynet:

“A shortage of fresh cash and the closure of many bank branches due to the war have forced Gaza’s residents to reuse the same banknotes for almost a year. “With so much use, the notes become worn and decayed, and I refuse to accept them,” says one market vendor. Meanwhile, a new profession is emerging in the strip: cleaning and refurbishing worn banknotes.

The closure of numerous bank branches in Gaza since the beginning of the war has led to a severe cash shortage, forcing residents to continue using old, tattered notes. A new trade called “note cleaning” is emerging, where old bills are cleaned and restored for reuse, with the service costing between 2 and 5 shekels per note.

Merchants, particularly in northern Gaza, warn that the only real solution to this crisis is reopening the closed banks and injecting fresh cash into the market. Otherwise, the risk of counterfeit currency spreading grows.

Additionally, cash withdrawals from ATMs in Gaza come with hefty fees ranging from 10% to 20%. Before the war, there were around 20 currency exchange offices in Gaza City alone, run by Hamas or taxed by the organization. These offices traded in various currencies and converted them, alongside several informal money changers operating in market corners.”

Where do we go from here?

Israel going cashless is another step in tightening control and violating property rights, for its citizens and its neighbors. This “going cashless” development is added to other worrying trends in Israel such as chewing on people’s pensions, and progressing Israel’s CBDC, the Digital Shekel.

A new economic reality is ahead of us. In such times, learning about Bitcoin becomes a necessity, in order to hedge against government tyranny with the only truly decentralized, secure cryptocurrency which is controlled by no one, and is fully permissionless, outside of government control.

This is a guest post by Efrat Fenigson. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

This post Israel Goes Cashless first appeared on Bitcoin Magazine and is written by Efrat Fenigson.

“What underpins a world order is always the financial system.

We are on the brink of a dramatic change where we are about to, and I’ll say this boldly, abandon the traditional system of money and accounting and introduce a new one. And the new one is what we call blockchain.

It means digital. It means having an almost perfect record of every single transaction that happens in the economy, which will give us far greater clarity over what’s going on. It also raises huge dangers in terms of the balance of power between states and citizens. In my opinion, we’re going to need a digital constitution of human rights if we’re going to have digital money.

Most people think that digital money is crypto and private, but what I see are superpowers introducing digital currency. The Chinese were the first. The US is on the brink of moving in the same direction. The Europeans have committed to that as well.”

This revolutionary speech about a new financial system, was delivered at the World Government Summit in March 2022 in Dubai, by Philippa “Pippa” Malmgren, a member of the Council on Foreign Relations (CFR) and Chatham House; her father, Harald Malmgren served as a senior advisor to US Presidents Kennedy, Nixon, Ford and others. She’s a technology entrepreneur and economist, who served as Special Assistant to President George W. Bush, for Economic Policy on the National Economic Council and is a former member of the President’s Working Group on Financial Markets and Corporate Governance.

Her words about the transition to a new world order that requires a new financial structure correspond well with the words of French President Emmanuel Macron in June 2023 at the Global Finance Summit in Paris: “The world needs a public financial shock to fight global warming, and the current system is not suitable for dealing with the world’s challenges.” The president of Brazil, Lula da Silva, also called for “a clean slate” and said the Bretton Woods organizations (World Bank, International Monetary Fund) do not serve their goals nor respond to society’s needs.

“The New Bretton Woods Moment”

“A new international monetary system is taking shape, some call it the new Bretton Woods moment that needs to be seized to create a new global financial governance,” says the investigative journalist Whitney Webb in a recent sitdown interview, where she mention that according to Mark Carney, former governor of the Bank of England & Bank of Canada and the UN Special Envoy for Climate Action and Finance, the three pillars of the new multi-polar world are Digital IDs, CBDCs and ESG, through a global carbon market. All world governments are pushing this agenda, that in order for it to succeed, all monetary systems and supporting systems must become digital and rely on digital data.
A good example of this was revealed at an event of the Central Bank of Israel with the Bank for International Settlements (BIS) – which I attended – in September 2023 in Tel Aviv, where the “Genesis Project” was presented. As part of this project, “green” bonds are issued, based on carbon quotas in the CBDC infrastructure. This is how the climate agenda is linked to financial markets.

“Debt Serfdom”

“Stablecoins could be the way in which the US is further globalizing the dollar, spreading its adoption directly to the world’s general public in order to continue increasing its debt and encourage uptake and usage of the dollar”, says Mark Goodwin, Editor in Chief of Bitcoin Magazine, in this interview with Whitney Webb. He suggests that the politician’s outcry of de-dollarization and the weakening of the dollar are a distraction from perpetuating the dollar as the world’s reserve currency.
“While CBDCs are what people are becoming fearful and aware of, it may just be the red herring, and the real strategy of the US dollar’s survival is highly regulated stablecoins (such as Tether), which can easily be programmable, even more than CBDCs, as well as seized, regulated and controlled indirectly by governments. 100 billion dollars in treasuries were already purchased by Tether, its subsidiaries and owners. Tether is positioned alongside the top 20 nation states buying debt from the US, with around one tenth of China or Japan that have a trillion dollars debt to the US”.

This theory, together with the words of Mark Carney, Pippa Malmgren, Emmanuel Macron & Lula Da Silva, join the calls of global leaders and heads of states, pointing to the replacement of the monetary and financial world order, to introduce a new monetary system. Many experts say that we are reaching the end of the current fiat monetary system experiment, which is destined to collapse. Since world leaders are aware of this, they prefer to engineer a controlled demolition, to maintain control and steer the course, and enter the new era with power firmly within their grasp.

Central Bank Digital Currency System (CBDC)

Central Bank Digital Currencies (CBDC), tie the financial freedom of citizens to the government and the banking establishment. The central bank issues its centralized digital currencies, and essentially creates a new monetary system, “fiat on steroids”, a system that takes everything that is bad in the fiat system, and adds more of it; surveillance, control, censorship, and enforcement capabilities. A modern prison? Indeed, the CBDC is the ultimate prototype of a prison without physical chains. By connecting CBDCs to digital identity cards, and to government systems such as universal basic income, social credits and more, we get the ultimate control apparatus. This apparatus will dictate to citizens what they’re allowed to purchase, what the permitted quotas are while limiting consumption according to rules and use cases, at programmed times, places and cadences. The system is able to determine the use of a geographic radius (geo-fencing), and to determine expiration dates on the money. Each remote controlled digital wallet can also be switched on and off by its operators. More than 130 countries are in the initial stages of piloting CBDC systems, of which 36 countries are in advanced pilots, and 3 countries have already launched systems (Nigeria, Jamaica and the Bahamas).

Will Ripple (XRP) Be The Chosen Platform for CBDC?

Ripple, a digital payment network and transaction protocol that owns the cryptocurrency XRP, is considered one of the most popular cryptocurrencies, and is strategically positioning itself at the heart of government financial innovation, aiming to be the cornerstone of future CBDCs.

The company is in talks with about twenty governments around the world to develop their CBDCs using Ripple’s technology. In May 2023, Ripple launched a dedicated CBDC platform to assist central banks, governments and financial institutions around the world in issuing CBDCs and stablecoins. To date, Ripple has partnered with six governments for CBDC pilot projects: Georgia, Colombia, Montenegro, Hong Kong, Bhutan and the Republic of Palau.

The National Bank of Georgia, for example, has chosen Ripple as its technology partner for its CBDC pilot last year, citing Ripple’s technical expertise and team capabilities. Its interest in CBDCs is in leveraging modern technologies, such as the programmability aspect of CBDCs, aiming to create a platform with smart contract and programmable token capabilities to stimulate innovation in the financial sector.

In the case of Bhutan, Ripple’s technology was chosen in 2021 for the country’s CBDC project to enable advanced cross-border payments, and assist in “financial inclusion” – in line with Bhutan’s mission to increase financial inclusion in Bhutan to 85% by 2023.

In 2022, Ripple reached the final stage of the G20 Techsprint CBDC Hackathon, hosted by Indonesia and the Bank of International Settlements (BIS), and in August 2023, the Republic of Palau launched a USD-backed digital currency, developed by Ripple.

Promoting its platform as an infrastructure for a CBDC, Ripple advocates for government regulation of cryptocurrencies, and tries to position itself as the preferred solution for CBDC projects. Its claim to fame of being the ideal CBDC partner for governments is the combination of speed, efficiency, a sustainable and “green” blockchain network that uses little energy (compared to the Bitcoin network), and interoperability – the ability to communicate and work with CBDC solutions in other countries on the Ripple infrastructure. The company warns that there is a risk for CBDC adoption by the public, caused mainly by a lack of market education, and it encourages the programming and expiration dates capabilities, which are perceived by most of the public as particularly Orwellian features of CBDCs.

Ripple encourages the abolition of cash (and a move to a cashless society), and unsurprisingly, it promotes the climate agenda; The company’s website presents its commitment to a clean, prosperous and secure low-carbon future, with a plan to reach carbon net-zero by 2030.

Apparently, in line with Ripple’s expansion strategy vis-a-vis governments, the company makes sure to recruit employees who came from central and commercial banks. One of the company’s top executives is Andrew Whitworth, policy director at Ripple, who previously worked at the Bank of England. At the same time as his role in Ripple, Whitworth also serves as a Director of the “Digital Pound Foundation”, an organization that has declared itself the authority on the Digital Pound; it advises and influences the government’s decisions regarding CBDC projects and deployments. Clearly an inside connection such as this might give Ripple an advantage in shaping digital currency policies to fit their platform and solutions. Does this hint a conflict of interests, or at least an unfair play?

Another avenue through which institutional influence and implicit control over Ripple could manifest is via a legal battle with the SEC (U.S. Securities and Exchange Commission) concerning the XRP cryptocurrency. Engaging in such legal disputes inevitably positions Ripple in a scenario where maintaining a positive relationship with institutions becomes crucial. Consequently, it’s no surprise that Ripple prioritizes governments, central banks, and financial institutions as its primary target audience in its market strategy.

Interesting Developments in CBDC

China spent a couple of years rolling out relatively failed CBDC projects without widespread adoption, while injecting 30 million yuan as free money to encourage user adoption. Transactions using the digital yuan hit 1.8 trillion yuan (US$249 billion) in June 2023.

Recently, significant progress has been made: the two main payment services and applications in China – WeChat and Alipay – which have a traffic of about 3-4 trillion dollars per year, integrated the Chinese CBDC service into their applications. The central bank regulator made it clear that digital yuan isn’t meant to compete with the two payments giants. Rather, it’s supposed to play a complementary role.

Elon Musk, who owns, among other things, the Twitter/X platform, has stated that he wants to make the platform an “everything app” like the Chinese WeChat, including payment management. Will X also follow the Chinese route and integrate the CBDC solution into it, or will it try to become a CBDC infrastructure itself with the help of Musk’s favorite cryptocurrency, the Dogecoin?

The CBDC pilot in Nigeria didn’t exactly take off either, after the citizens took to the streets to protest the abolition of cash in the country, and resented the introduction of an unneeded digital solution, while demanding the return of cash. After a long and painful protest, the cash was returned alongside the new digital currency, which was not canceled and became part of reality. Furthermore, a new stablecoin is in preparation in Sandbox mode in Nigeria. The cNGN is a Naira stablecoin which some claim has more potential than the e-Naira to be widely adopted. “The stablecoin will be more broadly interoperable than the CBDC, which is only available in the central bank’s wallet. At launch, the central bank’s wallet usability was weak, although it is now quite good”, said Bolu Abiodun, a reporter at Techpoint Africa.

The UK saw a strong public backlash to Prime Minister Rishi Sunak last year, with more than 50,000 responses sent to the Bank of England following a public hearing on the Digital Pound, aka the UK’s national CBDC.

Germany – Awareness of “Excessive Surveillance”

In Germany, the technical guidelines document for a digital currency of a central bank was published in January 2024. Below are several quotes from the document, reflecting the tyrannical nature of the new currency, and the awareness of the central bank for trust issues it can create:

• Programmability is the institution’s authority to dedicate your money for certain uses, and to prohibit the use of your wallet when it is “outside the permitted scope”.
• “The central bank can revoke CBDC notes, e. g. as an instrument of monetary control. Revocation of CBDC notes is performed by an authorized entity, the revocation authority, controlled and operated by the central bank.” This sounds like a technique to confiscate and apply a shelf life to money.
• “Payments permitted under certain restrictions.. if the central bank sees fit to impose them” – the document lists restrictions that can be applied to wallets, depending on the amount of personal information that will be provided. For example, the amount of money in the wallet, the number of payments per day, the amount of money per transaction or per day.
• The good news: The German central bank is aware of the possibility of public opposition to a surveillance system: “Many of these design choices are general decisions on the trade-off between excessive surveillance and legitimate monitoring functions for AML and KYC purposes in conjunction with measures for mitigating fraud and misconduct. These decisions are extremely sensitive in nature and can strongly influence the level of trust that users place into the CBDC”.

Israel – The Digital Shekel Will Be Distributed Through Commercial Banks

Israel takes an extensive and active part in various CBDC pilots, such as the Sela project, Eden, Icebreaker and more, which I have reported on extensively in the past. The Deputy Governor of the Bank of Israel announced that in December 2024 a technical design document for the Digital Shekel will be published, and its implementation will then begin in partnership with the private sector.

The Bank of Israel’s latest document from last week covers the proposed architecture of the Digital Shekel. Here are some interesting points from the document:

• The distribution of the Digital Shekel will be two-tiered: instead of direct contact between consumers and the central bank for funding and defunding, an indirect method similar to the distribution of cash today will be used. The banks will purchase digital shekels from the central bank in large quantities and transfer them to customers upon wallet charging.
• The system will be able to apply and enforce limits, for example limits on the balance that users are allowed to hold in the Digital Shekel.
• The system will support the possibility of applying interest on the Digital Shekel.
• Users will be able to access the Digital Shekel through several payment providers, including credit cards, Google/Apple Pay, wearables, payment apps and more.
• Unlike most retail CBDC solutions, Israel’s model allows users to open a wallet with a payment service provider (PSP) and connect to multiple third-party banks to fund and defund balances.

Another interesting development in Israel is the announcement of a plan to launch a new stablecoin pegged to the shekel, called BILS, by the exchange platform, Bits Of Gold. Crypto Jungle website reports that the Israeli Capital Market Authority approved the pilot, according to the draft principles published by the Central Bank of Israel. Interesting to note that the company providing the infrastructure for the issuance and custody of the currency is the Israeli technology giant “FireBlocks”, which took part in the “Eden” pilot project of the Tel Aviv Stock Exchange for the issuance of digital bonds, built to adapt in the future to a potential CBDC infrastructure.

No Internet? Don’t Worry, Governments Will Take Care Of Connectivity Anyway

A number of CBDC pilots, like in India, the European Union and more, focus on the adoption of the system by everyone, even amongst people without internet access. The washed-up name “financial inclusion” implies that the system will not skip anyone, not even citizens without Internet connectivity in remote areas, or without reception. In India for example, there are 683 million people living without an internet connection and largely outside the control of the state. The Reserve Bank of India (RBI) plans to bring these remote areas into a new surveillance network through various technological means. A successful launch of CBDC in India also corresponds with the government’s overarching goal of reducing cash usage and improving financial monitoring.

Thailand – Free Money for the Masses

In September 2023, the Thai government announced that any Thai citizen over the age of 16 who chooses to participate in the CBDC pilot, will receive free CBDC worth $280 (10,000 baht) – quite a lot of money in Thai terms. This digital money will be loaded into the digital wallet application and will be available for use within 6 months, and within a radius of 4 km from the residence of the registered citizens. The pilot targets low-income citizens as a first stage, and later expands to entrepreneurs and small business operators – provided they are registered in the tax system. In Thailand many citizens are not registered in the government systems and not everyone has a bank account. It seems that air-dropping “free money” is another tactic to lure citizens into government systems, with the bait of “free” controlled government money. But is there such a thing as “free lunch”?

The European Union – a Positive Marketing Campaign in High Gear

The European Union launched a marketing campaign to promote the digital euro about six months ago, to start educating the European public about a reality where that they will be obliged to use a supervised digital euro, led by Christine Lagarde, who was previously convicted of crimes and was promoted to serve as the governor of the European Central Bank, the ECB.

At the same time, a charade is going on in the European Union Parliament where the dangers of CBDCs are being discussed, only thanks to the public awareness and discourse, while Lagarde rushes forward and kicks off the marketing campaign to instill in the public the following messages: the digital euro is easy, safe, fast and reliable. Not a word about its Orwellian capabilities to track, program, limit and condition activity through expiration dates, geo-fencing, and remote on and off switching.

The Digital Euro Will Not Be Anonymous

In a discussion at the European Union Council in 2023, Lagarde emphasizes a point: the digital euro will not be anonymous. Privacy will exist in the system, but not anonymity. Let’s break this up in a different way: for the banks, the key to surveillance and control is identification. The bank must know who the citizen is and verify their identity, in order to exercise law enforcement or regulations, through technological restrictions. Lagarde’s claim that the technology will allow privacy but not anonymity is unfounded: apparently the central bank considers itself and the financial service providers some kind of God, since in front of them the citizen will be identified, and therefore it is not clear what kind of privacy can exist, without anonymity.

In a presentation from March 2024, the ECB presents a timetable for the Digital Euro. In November 2025, the development and implementation phase will begin, with the completion of the “democratic” legislative process.

The timing of the launch of the Digital Euro corresponds well with the European Union’s initiative to issue digital identity cards to all EU residents between now and 2030, to enable the necessary government identification and tracking of its citizens. Identical initiatives are enacted and promoted in many other countries around the world at the same time. Where I live, in Israel, ID cards and passports have been mandatory and digital for many years, and also biometric since 2013 – therefore there is no need to start the marketing campaign for the Digital Shekel yet, as the digital infrastructure exists hence the first step of digitalization is already done.

This phase of the project is the “preparation phase”, the ECB reveals, in which they are preparing for the launch phase of the Digital Euro. Of course, we are reassured that no final decision has yet been made regarding the launch of the CBDC, and this will only happen with the approval of the “Government Council” after the completion of the democratic legislative process of the European Union. Therefore, in parallel with the democratic debate for or against the Digital Euro, the development of the technology will continue, in order to be prepared for the launch.

Central bank governors such as Lagarde and Bank of Israel Governor Amir Yaron insist that the CBDC is digital cash, and also insist that physical cash will not be abolished. It is possible that these central bankers feel the need to make a U-turn from the incriminating speech of the head of the Bank for International Settlements (BIS), Augustin Carstens, who caused a public outcry when he stated in 2020 that the CBDC technology, unlike cash, will allow monitoring of financial transactions and will be a means of enforcement by the establishment:

“The key difference with the CBDC is the central bank will have absolute control of the rules and regulations that will determine the use of that

expression (money) of central bank liability, and also we will have the technology to enforce that.”

Agustín Carstens – BIS General Manager

The Future: Centralized and Controlled, or Free, Decentralized and Secure?

Ayn Rand, author and philosopher, said that “We can ignore reality, but we cannot ignore the consequences of ignoring reality.” Are we taking giant steps towards a new monetary reality, where the fiat currencies we know become fiat on steroids, aka CBDCs? Or into the reality of “stable” and closely regulated cryptocurrencies, tethered to fiat? Either way, the feeling is that the establishment is doing everything to preserve the debt economy, and its inherent modern slavery. The only way to break these fiat-matrix boundaries is to opt out and enter into a new system, which seems to run in a parallel reality, the Bitcoin system. On the Bitcoin standard, under self-custody, no third party has the ability to confiscate, program or take over private assets. Not even the government or the state. Bitcoin uses a lot of energy for its mining, but this proof-of-work mechanism makes the blockchain network extremely secure and the Bitcoin currency very valuable. Bitcoin is “safe money”, which is out of reach for the establishment. Unlike most other cryptocurrencies, Bitcoin is a digital currency without intermediaries or third parties (peer-to-peer) in a decentralized and secure network, which allows everyone to be their own bank, instead of relying on banks and external parties. With a fixed and known supply, it represents the most powerful digital asset on the market as a store of value and as a unit of account, and in the future will also be used as a medium of exchange.

In my recent interview with the media and finance expert, and one of the most famous Bitcoiners, Max Keiser, he compared the CBDC to a parasitic and centralized cancer: “If you were to look at the amount of energy that Bitcoin uses and the rate at which it’s increasing, you would say good is triumphing over evil. So this gives me a lot of hope. And I don’t think centralization in anything works at all, except cancer. Cancer is the only thing that seems to work to be overly centralized and parasitic. That’s the cancer model, but I think we’re gonna win against the cancer of CBDCs.” 

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This is a guest post by Efrat Fenigson. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

This post On the Brink of a Dramatic Change: The Digitalization of Money first appeared on Bitcoin Magazine and is written by Efrat Fenigson.