CBDCs Spark Privacy Fears as US Bans Them and EU Pushes Ahead

A leading think tank has warned that central bank digital currencies (CBDCs) could enable unprecedented levels of control over personal finances, effectively creating a scenario reminiscent of George Orwell’s dystopian novel 1984. In a recent analysis, Susie Violet Ward, co-founder and CEO of Bitcoin Policy UK, described CBDCs as the "weaponization of money in its purest form," emphasizing the risk of central banks imposing restrictions such as "expiry dates" on personal savings and monitoring individual spending patterns [1].

Ward’s remarks were made during a live session with Cointelegraph, where she highlighted how programmable money could allow institutions to control every financial action individuals take, raising serious concerns about privacy and financial autonomy. She noted that such a development would "close the 1984 loop perfectly," underscoring the potential for oppressive control over economic life through digital currency [1].

Meanwhile, the transatlantic divide in financial technology is deepening. The United States has taken a firm stance against CBDCs, with President Donald Trump signing an executive order in January 2025 that explicitly bans the creation, issuance, or use of CBDCs [1]. This move followed the House’s inclusion of a CBDC ban in the 2026 fiscal year defense policy bill, which prohibits the Federal Reserve from offering digital currencies or financial products directly to individuals [1]. Earlier in July, the House passed the Anti-CBDC Surveillance State Act with a narrow vote of 219 to 210, signaling growing legislative resistance to the concept [1].

In contrast, the European Union continues to advance its digital euro initiative, with ECB President Christine Lagarde announcing plans for a potential rollout by October 2025. Lagarde emphasized that the digital euro would coexist with cash and include privacy protections to prevent excessive government intrusion [1]. The EU has also shown interest in using major public blockchains like Ethereum, potentially offering more transparency and security than the private systems typically used in CBDC development [1].

Critics argue that the surveillance capabilities embedded in CBDC systems are a cause for alarm. In July 2023, Brazil’s central bank published the source code for its CBDC pilot, revealing mechanisms that allowed the central bank to freeze or reduce funds within user wallets [1]. These revelations have fueled skepticism about the true intent behind CBDC development, with many fearing that the promise of financial inclusion could be overshadowed by the risks of surveillance and control.

The growing divergence in CBDC strategies between the US and Europe highlights the broader ideological and technological rift shaping the future of digital finance. While the US prioritizes privacy and decentralized alternatives, the EU appears more willing to embrace state-backed digital money, albeit with safeguards. As global financial institutions continue to explore CBDCs, the debate over their implications for personal freedom, economic sovereignty, and institutional power is likely to intensify.

Sources:

[1] title: CBDCs close Orwell’s ’1984 loop perfectly,’ think tank says

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