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Opinion

The tyranny of state issued cryptocurrency

Government cryptocurrency

China’s social credit system has already been used to ban 23 million people from accessing travel networks. Government-controlled blockchain money will make things far, far worse.

One of several attractive features about bitcoin is that it is ‘open money’. Anyone can access it. Even those who are excluded from the banking system can send and receive bitcoin; all that is needed is an internet-connected device.

All of that falls apart when the blockchain is closed or private, meaning that in some way it features a control layer that restricts access. Governments already use the banking system to control their populations, one of the most concerning examples being China’s social credit scoring system; citizens accused of various social offences – from not paying taxes to taking drugs – are prevented from accessing certain services.

The Guardian explores the abuses connected with China’s social credit system, taking data recently published by China’s National Public Credit Information Centre. The report makes no attempt to hide its intentions, featuring the slogan, ‘Once discredited, limited everywhere’.

In the UK, so-called Azure cards are used to ensure that asylum seekers can only spend money they receive from the state on approved goods and services, while they are prevented from gaining employment. Exclusion from the financial system is, effectively, used as a means to force people into certain behaviour.

China is one of several countries to actively explore blockchain-based cash, and such a system could turbocharge efforts to control the population using the threat of exclusion from vital services or even the banking system overall. Financial surveillance could be carried out in real time, with Big Data insights being used to predict and head off activity that was deemed undesirable. 

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