Economies around the globe are making moves to implement a centralized digital currency under the guise of “convenience” — but if successful, it could lead to ultimate authoritarian control, warn experts.
The Bank of Canada (BoC) has said it has “paused” — not stopped — efforts to research and implement a central bank digital currency (CBDC), leaving the ultra-modernized way of banking to become a real possibility in Canada.
A report by the Justice Centre for Constitutional Freedoms (JCCF) shared with the Western Standard in advance of publication indicates a Bank of Canada CBDC is more than likely on the horizon in some capacity, particularly since Mark Carney has come on the scene in recent months — and escalated in prominence at such a rate he has already been named the leader of the Liberal party.
The report will be made publicly available on the JCCF website Monday March 17th at 10 a.m.
Carney, who was governor of both the Bank of Canada and the Bank of England, is a long-term supporter of CBDCs, as well as other policies pushed by the World Economic Forum (WEF), such as climate revolutionism.
As listed on the WEF website, prime minister-designate Carney, a WEF "Agenda Coordinator," belongs to a long list of global organizations and elite corporations, including multiple boards (though he insisted he has resigned from all his positions, the Western Standard earlier reported he still belongs to at least five), and is a member of the elusive Group of Thirty.
A November 2023 BoC public survey found a staggering 79% of Canadians opposed the implementation of a CBDC, indicating they did not trust the BoC’s ability to build and run a secure system.
“A CBDC could threaten Canadians’ privacy, security, autonomy, financial independence and their access to economic participation,” warned JCCF in the report.
“It could usher in a cashless economy, thereby removing access to the intangible but important benefits cash provides. A CBDC provides surveillance capabilities that can be used to monitor every financial transaction, and can program money with targeted restrictions that could differ from person to person, thereby increasing government control and reducing freedom.”
“CBDCs also raise significant concerns about transparency and accountability, as they grant governments greater control of money.”
JCCF points to the BoC survey that indicates the vast majority of Canadians “distrust and oppose” a CBDC — but the report notes given the financial struggles many Canadians find themselves in, the government could implement a CBDC and say it’s a means to provide financial relief.
The report argues that “cash remains essential to protect the rights and freedoms of Canadians, including their privacy, security, and autonomy.”
Centralized digital currency offers some “benefits,” according to global entities like the WEF, including convenience, “inclusivity” and efficiency — but the JCCF says the “significant concerns” well-surpass these minute perks.
“The reality is, there is no need for a central bank digital currency, the report’s lead author Benjamin Klassen told the Western Standard.
“But it could be very beneficial to governments and central banks to exert greater power and control over Canadians.”
“With a CBDC, they could exert way more power over the economy — way more direct power over it. It would have a pretty significant negative effect, at least on smaller banks, because banks rely to a huge extent on account deposits that people leave with them.”
Klassen explained, for example, if someone deposits $100 in a bank, the bank can then go and loan out that $100 to someone else.
“Now it's an asset on their balance sheet,” he said, adding that process repeats and the bank’s profit multiplies.
“That's how they make money. And that is really the backbone of modern capitalist economies. That's really what has made us so successful.”
“And so, if less people put their money in banks as ‘bank deposits’ because the money is now digital, then banks would have way less money to actually loan out, and would have a significantly negative effect on banks.”
JCCF emphasized the importance of maintaining a cash society, even if a CBDC is implemented.
“In a cashless economy, all transactions are digital, and therefore traceable and subject to inescapable financial surveillance and government interference,” states the report, pointing to the 2022 Freedom Convoy in Ottawa as an example.
Prime Minister Justin Trudeau’s Liberals at the time invoked the Emergencies Act, which allowed the government to order banks to freeze the accounts of about 200 peaceful protestors, and even some of those who donated as little as $50.
“A crucial lesson emerged: Canadians should always have access to cash,” wrote JCCF.
Carney has openly stated his willingness to use all powers available to him, including emergency powers, to deal with an ongoing trade war with the United States. Under such conditions, Carney could not only cling to power beyond the next scheduled election, he could usher in CBDC with the promise of issuing Canadians subsidies.
The report breaks down the concept of a CBDC into two main designs, each of which would be possible in Canada if the government decides to move forward on it:
A direct CBDC, where central banks have unrestricted access to people’s data
A hybrid CBDC, which limits, but doesn’t eliminate central bank meddling
A fully intermediated CBDC, where the central bank has (or should have) no access
The first operates in a single-tier system in which central banks handle CBDCs directly, whereas the latter two operate in a decentralized two-tier system where traditional banks handle them.
“The extent to which a CBDC threatens privacy, security, or autonomy largely depends on its design and implementation,” says the report.
“A crucial design question is whether the digital currency would be distributed and managed directly by the BoC, or indirectly through traditional banks.”
Yet, even with such safeguards as proposed by a decentralized two-tier model, “the government could, however, still pressure commercial banks to implement restrictions and limitations on its behalf, whether as part of the bank’s licensing or through regulations, leaving everyone at the mercy of banks and governments,” wrote the JCCF, explaining this was the case with the Freedom Convoy.
The architecture of the CBDC design would also dictate what that CBDC actually looks like: some models would be account-based and some token-based, or a combination of the two, Klassen said.
The BoC would have direct access to account-based models, while token-based models offer a layer of security with a unique code, or password, that the individual alone would hold that no other person or entity would have access to.
Some models are a combination of the two, where the individual would have their token-based CBDC, but it would be registered through an account moderated by a bank.
However, even a token system with unique codes could operate on a ledger, which the BoC could theoretically access through “backdoor” methods, explained Klassen.
A key concern with any structure of CBDC is the government’s ability to “program” tokens to control lifestyle and surveille citizens. The report says the programmability of digital currency allows for “built-in rules and constraints for users.”
“CBDCs can be programmed to include functions like automatic point-of-sale tax collection, or ‘smart contracts’ that could determine where, when, and what each person is allowed to purchase,” reads the report.
“Programmability would also allow governments to implement targeted financial policies, such as negative interest rates on people’s savings, forcing them to spend.”
CBDCs can also be programmed with “tracking features” which would “enable widespread surveillance and control of the population,” wrote JCCF.
“Even if programmability was not included initially, the functionality could easily be added later. CBDCs could also threaten Canadians’ access to economic participation as many children, elderly, homeless and technologically illiterate individuals would be left out of the financial system.”
Klassen says this “programmability” can be built into any stricture of CBDC — “it would be really, really effectively used in a centralized system, in a direct CBDC, it could also be used in decentralized ways.”
“If it was a completely intermediated system, then the government would not necessarily have access to granular information regarding an account and account transactions, so that they would be able to program every single program token,” said Klassen.
For example, whenever the government issues subsidies, “they could issue those tokens with programmable features so that you cannot use those tokens for certain things,” he added.
Bo Li, former Deputy Governor of the People’s Bank of China, speaking to officials at a roundtable in Washington in 2022, “highlighted how it could be used for targeted policy goals like welfare payments, consumption coupons, and food stamps, determining what people can purchase and own.”
“Similarly, CBDCs could be programmed to support ‘green’ agendas by limiting what foods or how much gasoline a person could purchase; or promote healthy living by restricting the purchase of junk food and sweetened beverages,” said the report.
“Under a direct CBDC model, where central banks have access to all user accounts and transactions, CBDCs could be programmed to make it impossible to purchase whatever the programmers choose — from airplane tickets to clothing or medicine — or even erase the digital money from people’s e-wallets with the push of a button.”
Notably, even if a seemingly benign centralized digital currency was implemented, “once citizens have become accustomed to a CBDC, governments could introduce authoritarian programmable features under the guise of any plausible justification, such as increasing convenience or preventing crime,” warned the Justice Centre.
The Justice Centre put forward critical action steps Canadians can exercise at the grassroots level, including using cash on a regular basis to keep it in demand, drafting parliamentary petitions and pursuing MPs to support them in Parliament, contacting local politicians and running for public office.
Policy recommendations include mandating widespread acceptance of cash, as Canadian businesses are not currently required to accept physical cash, mandating banks to keep cash on-hand, prohibit exclusive use of CBDCs for government subsidies, and prohibit programmable restrictions on CBDCs.
