Count former President Donald Trump among those concerned about Central Bank Digital Currencies (CBDCs) and the advancements in artificial intelligence (AI).
What Happened: "Very dangerous. It's very dangerous. One day you don't have any money in your account. It can be a very dangerous thing," Trump, who has been indicted four times, told Fox Business’ Maria Bartiromo.
Trump emphasized the risks associated with CBDCs, suggesting that they could lead to significant surveillance and control issues.
The former President — who faces 44 federal charges and 47 state charges, all of them felonies — also highlighted what he considers the dangers of AI, particularly the technology's ability to create highly realistic and indistinguishable digital replicas of individuals.
As the U.S. election cycle looms, troubling AI-generated deepfakes — including fabricated explicit images of singer Taylor Swift and voice alterations of U.S. President Joe Biden — have emerged.
Trump claims AI was used to fabricate a speech he never gave, raising concerns about the technology's potential misuse in misinformation and security breaches.
"This is a tremendous problem in terms of security," Trump warned.
Why It Matters: According to a Bank of America report, central banks representing two-thirds of the world's nations and 98% of the global GDP are currently exploring the development of CBDCs.
However, the Federal Reserve remains cautious, stating that it will not issue a CBDC without support from the executive branch and Congress.
Proponents of CBDCs argue that they can streamline payment systems, aid in monetary policy implementation and enhance financial inclusivity.
However, analysts at Bank of America also warn of potential downsides, including competition with bank deposits, increased instances of bank runs and loss of monetary sovereignty.
The innovation in digital assets is expected to be driven by central banks and governments, leveraging private sector resources.
This collaboration could be beneficial in all stages of CBDC implementation, with the Bank of America maintaining a positive outlook on the transformative potential of CBDCs in the global financial landscape.
In a separate development, the Swiss National Bank announced a collaboration with the SIX Digital Exchange and six commercial banks to pilot a wholesale CBDC, indicating the growing global interest in digital currencies.
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