At the Bitcoin Atlantis conference in Madeira in 2024, Bitcoin experts were asked a the same question: Can Bitcoin coexist with Central Bank Digital Currencies (CBDCs)? Their candid and often fiery responses shed light on a pivotal issue for the future of digital finance. From dismissing CBDCs as “bullshit” to acknowledging them as a potential counterbalance to Bitcoin’s decentralized nature, these experts didn’t hold back. Unfiltered opinions and insights from influential voices in the Bitcoin world as they explore whether these two financial systems can share the same stage.
Participants: Peter McCormack, Lyn Alden, Aleks Svetski, Julian Liniger, Eric V Stacks, Ben Perrin, and Niko Jilch.
- Julian Liniger: “I think so, I think it that will be the case that fiat money, which is transitioning into CBDCs, is also inevitable and this will not go away completely. I think this inflationary, government-driven financial system, which is the fiat financial system with fractional reserve banking and monetary policies from central banks and CBDCs, will always coexist with the deflationary, decentralized, open-source, neutral, global, censorship-resistant financial system built on Bitcoin. They will both coexist, but Bitcoin will definitely grow in importance, and the Bitcoin/fiat ratio will increase, but they will always coexist.”
- Peter McCormack: “I mean sure they can coexist, but how much people will use them is a different story. I’ve never used one; that’s fucking bullshit. They will for a time, but then they’ll just fail because they suck.”
- Aleks Svetski: “They will coexist for a time, but then they’ll just fail because they suck.”
- Ben Perrin: “The only thing that is a threat to Bitcoin is if they were to responsibly launch a sound money that was efficient and promoted freedom. Last I checked, no governments are very interested in that. So, can they coexist for a period of time? They most certainly will, but not through choice—it will be through coercion. Speech and information want to be free, and they will be; it just may take a little while to navigate how to do that.”
- Lyn Alden: “Maybe in some small way. I think that we saw in Nigeria, it’s been very hard for them to introduce a CBDC with any sort of traction behind it. It’s been out for years, and yet more people in the country use Bitcoin and stablecoins than use the eNaira. Maybe a country like China will be more successful at making that work for a longer period of time, but anything other than the biggest players will struggle. If anything, CBDCs are kind of like free marketing for Bitcoin. Anytime someone finds that they want to buy something and are blocked from buying it, or find that their money only works in their own jurisdiction, it’s an advertisement for the opposite—money that is controlled by you and can’t easily be stopped by other powers.”
- Eric V Stacks: “Absolutely, yeah. I think that we currently already have digital money; it’s a digital centralized database. With the evolution of technology, I think it would be foolish to think that the shareholders and stakeholders within the fiat construct aren’t going to further enhance its programmability. But I also believe that the existence of Bitcoin will keep CBDCs more honest and is the antidote to the corruption that could take place with CBDCs. I believe CBDCs are coming; they’re already here in some parts of the world. It’s just the evolution of the fiat paradigm.”
- Niko Jilch: “I mean the short answer is yes. If fiat money like we have today can coexist with Bitcoin, then CBDCs can also coexist with Bitcoin. It’s very hard to talk about CBDCs because, for the most part, they don’t exist yet; it’s all hearsay and theories. In the short term, CBDCs can coexist with Bitcoin. There is a possibility that Bitcoin, when it becomes a reserve asset, will be held by central banks who issue CBDCs. Bitcoin has changed the landscape in a very important way. With gold, you couldn’t send a bar of gold from London to Paris in an efficient way to settle a transaction. You can do this with Bitcoin. So, Bitcoin is a very important counterbalance to the inflationary fiat system. CBDCs are just one new version of the inflationary fiat system that already has many problems, and CBDCs will not solve a single problem; they will make some problems worse, but that doesn’t mean they won’t try. So, technically, for a while, they can coexist; long term, I have my doubts.”
Conclusion:
The diverse perspectives gathered at Bitcoin Atlantis 2024 reflect a nuanced outlook on the coexistence of Bitcoin and CBDCs. While some experts believe in the temporary coexistence of the two systems, others highlight the inherent advantages of Bitcoin—decentralization, censorship resistance, and user control—which position it as a more resilient and superior financial system in the long term. The practical challenges faced by CBDCs, as highlighted by the experts, further underscore Bitcoin’s potential for growth and resilience. As digital currencies continue to evolve, the debate on their coexistence will undoubtedly shape the future of global finance.
