Stablecoins as a Trojan Horse

People liken Bitcoin to a trojan horse infiltrating the legacy financial system and government, while stablecoins are already embedded in our system.

Stablecoins are hailed as saviors for the developing world, offering escape from ineffective financial systems and local currency risks. However, traps lure you in; thus, they must be enticing.

Most stablecoin volume is on centralized blockchains, governed by centralized smart contracts that can freeze or seize tokens. This is controlled by issuers, granting them the power to control funds globally.

These blockchains utilize an account model, correlating user transactions with a single public address, exposing their entire transaction history. There’s no complex analysis required; just look at the account address.

Additionally, due to their centralization, users interact with wallets connecting to a few centralized servers, linking their IP addresses to accounts. Thus, stablecoins present a trap.

The United States doesn’t need a Central Bank Digital Currency (CBDC)—it has US Dollar stablecoins already functioning similarly. These stablecoins collect private information vulnerable to connection from KYC exchanges or social media.

Stablecoins are programmable, capable of enforcing restrictions like expiry or limited use, much like CBDCs. The key difference lies in their adoption; stablecoins are favored while CBDCs face skepticism.

All essential elements are present: centralized control to seize tokens, lack of privacy linking KYC data to on-chain activities, and concentration of private information accessible to the government for coercive measures.

Stablecoins act as proxies for US dollars, requiring interaction with the legacy financial system, tied to government control whenever desired.

It is mind-boggling that people not only accept this process but even support it. While Bitcoin seeks to be a truly sovereign currency, stablecoins promote the very opposite narrative.

CBDCs distract us from facing the real threat looming in the form of stablecoins and the financial surveillance they impose. We should confront this reality rather than ignore it.

This article is a Take. Opinions expressed are entirely the author’s and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

This post Stablecoins Are The CBDCs first appeared on Bitcoin Magazine and is written by Shinobi.