Dr. Natalie Smolenski, Senior Fellow, Bitcoin Policy Institute (BPI), tells the International Monetary Fund (IMF) to adopt Bitcoin and avoid Central Bank Digital Currency (CBDC).
Invited to attend the IMF’s “The Fight for the Future of Money” virtual seminar on January 20, 2023, Dr. Smolenski also discussed the pros and cons of CBDCs. She was joined by former CFTC Chairman J. Chris Giancarlo, and the IMF’s Tommaso Mancini-Griffoli.
Sharing the details, the BPI tweeted:
In her presentation, Dr. Smolenski included a quote from the President of the Minnesota Federal Reserve, Neel Kashkari:
I keep asking anybody—anybody at the Fed, or outside the Fed—to explain to me what problem this [CBDC] is solving.
Dr. Smolenski advocated the use of BTC as an alternative to CBDCs at the said event. In her powerpoint presentation, Dr. Smolenski discusses the value proposition of CBDCs. She states on the “Innovative Benefit” parameter, CBDCs do not offer any novel solutions. Real-time settlement is already available via FedNow and the Bitcoin Lightning Network, says Dr. Smolenski.
CBDCs would, via cash replacement and ID verification, allow the state to “capture additional tax revenue,” Dr. Smolenski notes. She believes CBDCs also do not solve financial inclusion and wealth redistribution issues.
Dr. Smolenski says, Biggest barriers to banking system inclusion are AML/KYC and low income, which CBDCs do not solve. Bitcoin doesn’t present these barriers.
She clarifies that CBDCs instead lead to full surveillance, individually-targeted “monetary policy,” and capturing revenue from the “informal” economy. Owing to their design requirement, per Dr. Smolenski,
CBDCs lead to ID verification for every transaction.
Dr. Smolenski adds that CBDCs tend to “Blur the Distinction between Central and Commercial Banks.” Dr. Natalie Smolenski’s powerpoint presentation in question is delivered for the Independent Evaluation Office of the IMF.
Dr. Natalie Smolenski is also the Founder and Executive Director of the Texas Bitcoin Fund (TBF), and the Head of Business Development at Hyland—a leading content services provider.