Cardano Buy Back For Central Bank Digital Currency

What if the US Government made crypto illegal but offered to buy back each of your ADA right now for Cardano Certificates worth $5 payable in CBDC? Would you do it? My guess is that most people would. Of course your CBDC would be inflated out of existence in a short time or just disappeared if you try to cash it out or spend it in a way that the government doesn’t approved of. But if crypto is made illegal then the price will plummet anyway. I think most people would sell rather than go to jail. Has anyone considered how they might respond if Biden makes and executive order like the one made in 1933 making gold illegal to own?

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I read the first 2 lines in my email & first went running to respond exactly as suggested in the OP: inflation, oppressive regulation, and the Devil’s Bargain it will eventually lead to for all of us in one way or another.

Without indicating my personal choice, I would say Ada is as good an option as any crypto for use in a parallel economy (some would say “black market”; others, the only remaining “free enterprise”) because the most popular Ethereum based DeFi choices seem headed for full regulatory compliance. It’s not pleasant to hold onto a fungible asset for the rest of your life if you can’t invest it: and there are some Cardano DeFi choices who’ve sounded like they’re delaying the notion of SEC & US Treasury compliance indefinitely.

Those who haven’t considered this issue yet might be interested in reading these two government positions — one from the World Economic Forum and the other from their factotum in the USA. I doubt it’s a coincidence they were released in the same month:

Practically, though, I don’t see blacklisting Ada along with all other cryptocurrencies would cause its effective price to “plummet” because at that point there would be two separate economies, each with its own standard of value. From that point the fiat value of any circulating cryptocurrency remaining would be unimportant relative to what it might be exchanged for within that parallel economy. The WEF paper above makes it clear the new CBDCs will only usable for what the government allows… providing permissionless cryptocurrencies, by contrast, with the unique feature of unconstrained economic activity within an otherwise inescapable world of capital control. :radioactive:

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Since I’m not in US I would leverage the s*@t out my ADA since I just found out it’s about 5x. :+1:
…and since ADA is global and not local to US, I would assume a lot of people would just sell, get CBDC, transfer CBDC to $, then go back to exchange and buy more ADA below $5 (since it wouldn’t be illegal to buy if you are not in US) and repeat the process until arbitrage is over.

Then if they end up controlling more then 51% of ADA we would just all copy the network, since it’s open source and use all those profits from $5 buy back program to start Cardano 2.0 (which would be exactly the same as 1st Cardano) and carry on as usual. :wink:

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Wow! The Advancing Digital Agency article applies very well to my previous comment in this forum about a Smart Constitution For Cardano. Seems like someone is at least thinking about an AI that can interpret law. Anyway I am not concerned about black listing ADA. I am concerned that (like gold in 1933) owning it may be a jailable offence. I am wondering if others are concerned about the possibility and what strategy others might be planning in that event. Much thanks for the articles.

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Nice plan. Since you are in another country you would not have to worry about being jailed for owning cryptocurrency. So you could sell it for something else you value to the greedy US citizens who think their CBDC won’t get disappeared.

My plan is to try and make it to El Salvador before they finish the border wall between the US and Mexico.

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I do think that the WEF proposals, headed full speed to adoption in the USA as quickly as they would under European style socialism, will effectively blacklist all economic activities that are not explicitly “whitelisted” somehow: as fully regulated cryptocurrency transactions (if crypto remains conditionally legal) or simply preprogrammed uses of a CBDC.

Therefore the only response to assure freedom is to respond in the same way to today’s regulation as one would to tomorrow’s potential illegality. Crypto exchanges are already expected to be relied upon as intermediaries when authoritarian governments decide to freeze and/or seize assets without due process, e.g. as in the recent response to civil protests in Canada:

As per the WEF model for society, any activity that would have been prosecuted with due legal process leading to “jail” can now be prosecuted by a technocracy without any legal process at all. The only difference is instead of “jail” you end up in some desperate state of exclusion… penniless, jobless, homeless, stateless… perhaps without a license to use the Internet itself.

Therefore I think any robust security system, designed to protect against any malevolent intrusions, must conceal one’s assets just as completely as it protects against theft: by governments and their “intermediaries” as well as any other criminals.

It seems overkill and “unfair” to anyone with a notion of liberty but this proceeds logically from government presentations thus far; that the only safe strategy is concealment: with isolated storage for the bulk of one’s assets, anonymous use of smart contracts for investment, and progressive layers of relaxing anonymity on the way to whatever boundaries there may be with fiat and/or identity-driven goods & services.

If I remember correctly, you & your brother designed a brilliant strategy for such asset storage, which I was also thinking about when committing to an Ada stake pool pledge while coming up with a different approach; this one providing many benefits of a hardware wallet without the identity exposure of purchasing anything but a memory stick:

In summary although I do think we will have two parallel economies … “black” and “white” markets, if at this point anyone still thinks of the world’s colluding governments as “white” … they don’t have to be geographically separated, nor should we have to choose our domicile based on its extent of crypto or any other regulation. But our assets will need to be separated, with much more care than they needed to be in the first days of crypto, and as with many security problems it’s at least academically helpful to think of “jail” as a consequence of not doing everything right.

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I really like the Frankenwallet! If I understand it correctly it’s a lot like the software portion of the PrivateKeyVault. In fact I think your software would run on the hardware portion of the PKV. I will need some time to study it more.

I had been against secrecy in the past because I didn’t want to give up the benefits of transparency. But now that I see how Canada (a so called democracy) is acting like China and how so many American politicians are trying to kill our right to take custody of our own money, I am starting to see that moving to privacy in spending may be unavoidable.

One thing you can do with the PKV is to encrypt an offline transaction and broadcast it on YouTube to be picked up by someone in another country to process. Who’s going to know what’s in the message, and who is going to know who picked it up for processing. This is what the setup looks like for a broadcast.

I hope the legacy banking system doesn’t try to take democracy with it when it dies. Because as long as people have custody of their money then they can vote with their feet and take democracy with them to their new homes.

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I probably would comply, and happily do so, since the society out there that I’m financing with my taxes is far more important than this cryptocurrency game which up to now has not provided any tangible value – ape pictures and dog coins aside.

If the society decides to finally put an end to Bitcoin burning the planet, that’s good, almost too late. If they throw PoS coins under the bus on the way, so be it.

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Thanks for your reply. Comply is certainly a valid option. I am all for building society and for paying my share of the taxes required to to do it. But there comes a point where the government has too much money and only uses it to acquire more money and will destroy its own infrastructure and citizenry to get it. For me the most important use case for crypto is to contain this behavior. Imagine if every citizen in Russia had custody of their own money and could communicate well enough through blockchain voting to control how that money flows. If that were the case, the government simply wouldn’t have enough money to wage a war. This is the promise of Cardano. This is why I am involved in the community.

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Can mostly speak of the German situation, here, but I guess, US would be similar.

They are far from having too much money, quite the opposite.

They let infrastructure crumble to dust, because there is not enough money to maintain it. They do not build the public transportation needed for climate reasons, because there’s no money. They do not pay universal basic income, because it’s deemed to be financially infeasible.

And that’s not all out of malice. While there are enough politicians who just do not believe in universal basic income, virtually none would deny building shiny new infrastructure – even climate-friendly – if they had more than enough money. They even curtail all of this if new money is needed for the military.

You might have a vision, where all of this is paid for directly by the people circumventing the government and replacing the democratic process in between by something blockchainish, but I don’t think that that is feasible. I have seen too many experiments in direct democracy fail to still believe that we would just give a voting system on a chain to the people and all would be good.

There is much room for improvement given the current legislators and government members (although it’s much better than three years ago in DE as well as US), but it’s harder to achieve than one might think and people you thought were perfect for the job turn out to be not so perfect, proposals you thought were no-brainers turn out to have strong opposition, options you thought were no-gos turn out to be adopted, …

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Thanks for the thoughtful response. I think there is plenty of money. The problem is that lack of transparency prevents us from seeing that a large portion of the money is legally stolen. According to the book Moneyland by Oliver Bullough as much as 30% of all money in Russia is stolen in a bribe pyramid and this money is laundered mostly in England and the United States through off shore banks and shell companies. We can do better by moving to blockchain.

It’s not direct democracy and it’s not just a voting system. It’s elected representatives legislating through smart contracts and a voting system directly connected to tax payer money. That’s what Cardano is building. This is new and worth trying. That’s why I am all in.

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I haven’t read anything resembling that up to now. Do you have a link?

The only plans for the Voltaire era that I know of are:
https://docs.cardano.org/explore-cardano/relevant-research-papers#voltaire

That’s only updates to the Cardano blockchain itself and funding through the treasury (not a greater scheme of political change). And it’s decided by votes on chain with the possibility of delegating to experts, where these experts are not really the same as elected representatives. They don’t have a term, they don’t have their own budget and staff and they may lose all delegations on every next vote.

For a corporation, voting power by shares is quite obvious. For a system like Cardano, it might or might not be a good idea to give IOG, Emurgo and Binance that much more voting power. For a system that should replace our democracies, voting power by wealth sounds like a pretty bad idea.

The smart contract thing first looked quite superfluous to me. The important things in politics cannot be formulated in very restrictive formal languages. But they could perhaps give some more transparency to governmental finances (although they already are pretty transparent in many countries and not many people care too much for the details).

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Your points are very well represented. I have only several video discussions, like this, by a man who thinks we can do better, who has an amazing track record of doing the things he promises, and who backed his ideas with a lifetime of work and 20 million dollars of his own money.

Most people need to know what they are going to make before they start their work.
But I have discovered that it is possible to accomplish tasks that are way beyond the limits of my own intellect by letting go of the big plan and just doing the work set down in front of me. I think this is what Charles is doing. This is what I am supporting.

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In my part of the world the legal status of crypto is still ambiguous neither banned nor completely legal. If govt launches CBDC and offers lucrative exchange not all will fall for the bait many of us are in crypto for defi; legal compliances will kill the whole spirit of cryptocurrency and blockchain technology.

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