BRAZIL’S CENTRAL BANK DIGITAL CURRENCY CODE HAS SOME INTRIGUING ...
This certainly has been a fascinating and, in some respects, entertaining week. For example, and in case you missed it, former Faux TV anchorman Tucker Carlson hosted a debate in Iowa featuring several of the bottom-of-the-card Republican presidential candidates who proved themselves to a man (and a woman) worthy of my epithet of Republithug... and he decimated them by asking them - horror of horrors - real questions which none of them were obviously prepared for, except maybe Mike Pence, who arrogantly puckered his face up into a point and dutifully read his lines from the script, and informed the entire country that the entire country was...well.... not his concern:
With such hubris and incompetence on parade, one could be forgiven for thinking they were all members of the Bush or Bai Den famdamnlies. I confess, I thoroughly enjoyed not only the asking of actual real questions of these schlubbs, but watching them squirm, wiggle, and writhe as they tried to think of real answers, or, in Pence's case, watching him spread his tail feathers and somehow manage to strut like a peacock while remaining seated. (Frankly, I'd much rather listen to the shriek of a peacock than to Mr. Pence.)
But beyond the entertainment there were some stories of far meatier content and consequence this week, and one of them we need to address right up front, because it's a kind of "we told you so" moment. Many of you spotted it and passed it along (thank you), but we're going to concentrate on this version shared by T.M. (again, with our thanks):
Ever since the emergence of so-called digital "Crypto-'currencies'", I along with many others including our friend and colleague Catherine Austin Fitts have been warning that crypto-currencies, especially if they become the basis of central bank digital currencies, are (1) not secure, since no cyber system ever really is, and (2) not currencies at all, but corporate coupons (at best), whose value can be manipulated at will by the programmer, and (3) not only whose value can be manipulated, but can be completely turned off or on, or made subject to a "time limit" (spend it or lose it), thus making it impossible to accumulate wealth for yourself or your children and grandchildren. They are, to be blunt but completely honest about it, merely a means of social control and engineering. As far as the so-called security of cyrpto-currencies goes, I need only remind the reader of the initial claims for blockchains and distributed ledgers. At last (!) we were assured, there is something entirely safe and entirely out of the hands of the central banksters.
...until the stories of hacked cryptos finally emerged.
Well, Brazil's central bank has revealed the code for its proposed central bank digital currency, and guess what?
Blockchain developer Pedro Magalhães claims that he has successfully reverse-engineered the source code of Brazil’s pilot central bank digital currency (CBDC). He revealed the existence of functions that empower a central authority to freeze funds or reduce balances.
While concerns over such capabilities have been raised, the developer argues that there could be certain situations where these functions might prove beneficial.
On July 6, the Banco Central do Brazil published the source code of the digital Brazilian real pilot project on the GitHub portal, emphasizing that it was solely intended for testing purposes and subject to potential modifications.
Pedro Magalhães, a noted blockchain developer and founder of tech consulting firm Iora Labs, announced later that he had successfully “reverse-engineered” the open-source code, exposing various functions. These included freezing and unfreezing accounts, adjusting balances, transferring currency between addresses, and generating or eliminating digital real from specific addresses.
Magalhães pointed out that the code lacked explicit specifications regarding the circumstances under which the tokens could be frozen and, more crucially, who possesses the authority to execute such actions.
The blockchain dev expressed concerns about an institution unilaterally freezing a user’s balance, highlighting the stark contrast between executing decentralized finance operations and granting an institution the power to freeze funds.
So there it is folks, our warnings are no longer mere speculation or hypothesis, they are a beta-test reality.
And they're a sure and certain one-way ticket to a serfdom and slavery far more total and all-encompassing than anything yet seen in human history, one with all the ham-fisted grace and compassion of the tax man and the high-pitched precision of a dentist's drill, for you'll note that the capabilities as listed could be narrowly tailored to an individual, or broadened to incorporate whole (uncooperative) regions and their populations. And neither Ms. Fitts nor I are the only ones trying to sound a warning:
In this context it is worth mentioning that Brazil is, of course, a "BRICS" nation, one of the original "big four" of the loose cooperative economic alliance of Brazil, Russia, India, and China, and now, South Africa and many others. Most of the Big BRICS Four have already concluded various bilateral currency agreements allowing them to buy each other's commodities and clear their transactions in each other's currencies, bypassing the dollar completely.
Bear this little bit of news in mind, when you read this Wednesday's blog about the upcoming BRICS summit in August...
In the meantime, I repeat my oft-repeated warnings: any genuine currency is always, first, foremost, and finally, a physical medium of exchange, even blips on a bank's computer ledger are, because they are subject to that all important rule of convertibility: the blips can be traded for a piece of paper which in turn can be used to conduct transactions. Even better if that piece of paper can be converted into a tangible amount of silver or gold, and if that silver or gold can be used to conduct transactions. Any functional monetary system has, as one of its salient features, redundancy and convertability between different forms of money. A cashless system of digital "currency" is none of these things. It's a title deed to you...
See you on the flip side...
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