The race to roll out Central Bank Digital Currency (CBDC) into circulation by many countries globally is notable. The digital currency seeks to adopt a centralized theme where the government indirectly influences its issuance and supervision. The trial programs prove successful in some countries such as Japan and Brazil. Economic powerhouses such as the USA have plans to begin research and roll out digital currency infrastructure. 

Negative elements might result despite the Central Banks being responsible for the coins. The following are some notable setbacks that will prove the currency's negative influence on the populace:
<h2>Expensive Transactions via Third Party Entities </h2>
The issuance of digital coins by the Central Banks follows the identification of commercial banking organizations that will enable consumer trading. The smaller banks collect user data for account creation and issuance of digital currency to facilitate their transactions. 

The existence of commercial <a href="https://www.cryptoknowmics.com/news/bank-of-england-collaborates-with-mit-on-cbdc-research-project">banks</a> as the intermediary between consumers and manufacturers sustains the problem of heavy transaction costs. The choice by governments to ignore blockchain technology when rolling out their digital currencies indicates a willingness to continue making revenue. Despite the efforts to ensure efficient trading, financial organizations provide a setback to consumer satisfaction due to transaction fees. 

The profit-driven nature of the commercial institutions will hurt traders whose transactions will trigger burdensome deductions. However, indirect government influence means they will not be keen to intervene and ease the burden via financial cushioning to consumers. 
<h2>High Risk of Inflation </h2>
The <a href="https://coinmarketcap.com/all/views/all/">digital coins</a> are the virtual version of the paper fiat currency; thus, their strength depends on the country's economy. The risk of inflation due to economic phenomena is high because it is not independent of the fiat currency's strength. Therefore, digital currency does not protect consumers as much as cryptocurrencies.

The ability of the Central Banks to issue digital coins and control the financial activities of the coins presents another danger. The risk of overissuance exists when the digital tokens lose value and cause inflation which is adverse to trading entities. The lack of mechanisms for the stable introduction of the coins into the economy creates a failure to mitigate potential outcomes of inflation.
<h2>Traceability Threatens User Privacy </h2>
The existence of user data in the servers of a central bank provides access to data that allows traceability of individuals. Despite the aspect facilitating the fight against money laundering and tax evasion, it also provides a channel for undermining user privacy. The necessary privacy <a href="https://www.ledgerinsights.com/u-s-legislators-publish-multiple-cbdc-bills-with-privacy-emphasis/">legislation</a> must first exist. 

The ability of bank staffers to access clients' data makes them vulnerable to political or business witch hunts by opponents. The non-permanent nature of transaction records means it is susceptible to alterations to target individuals by high-ranking personnel. 

Additionally, the danger of private banking entities sharing consumer data with data mining corporations is a risk to user privacy. Such data for targeted marketing campaigns is a strategy for consumer manipulation for revenue generation efforts. The absence of stringent measures against such activities will expose users to the dangers of data misuse. 
<h2>High-Security Risks </h2>
The issue of security risks on user data and transactions involving digital currency arises from two possibilities. First, the centralized nature of transaction records makes them vulnerable to cyber-attacks and loss of user data and assets. The absence of a public ledger, as in the case of crypto technology, means data is vulnerable to deletion, changes, and piracy with little knowledge. 

Secondly, the absence of validation structures to allow transactions means the digital currencies are in danger of fraudulent usage. The danger of access to personal data means scammers can transact on behalf of individuals without noticeable system reaction. The blockchain version of private and public keys for traders does not exist for digital currency, making it ideal for fraudsters.
<h2>Risks Freedom of Trading in CryptoCurrency  </h2>
Using a fiat digital coin for trading in a country will shun the potential adoption of other reliable cryptocurrency alternatives. The attempts by governments to ensure the success of the digital currency will inform efforts to undermine free competition from blockchain-based currencies. 

The efforts will be via <a href="https://www.cryptoknowmics.com/news/jpmorgan-banks-urgently-need-global-regulation-to-let-customers-invest-in-crypto">legislation</a> to ensure stringent taxes on cryptocurrencies to discourage consumers from delving into the technology. Despite being a promising option, the absence of government control on blockchain platforms makes them bad for revenue creation for the government. 

However, such efforts to limit the influence of crypto over the digital coin will only hurt traders who will need to deal with the high trading costs. 
<h2>Takeaways</h2>
The use of CBDC is increasing with governments under pressure to sustain economic recovery efforts during the pandemic and war crises. However, the need to control the digital coin proves to be the soft spot for the innovative strategy as it undermines consumer satisfaction. 

The research on the sustainability and reliability of the digital currency in countries must provide a basis for discussing potential improvements in policy.

Reasons Why CBDCs are not for the Greater Good of the People 

The digital currency seeks to adopt a centralized theme where the government indirectly influences its issuance and supervision.

Adam is an outgoing young lad who likes adventures and discovering new things.Despite his boring life, he loves writing about cryptocurrencies and exploring what blockchain technology can do for the coming digital world where all adventures will be virtual.

Reasons Why CBDCs are not for the Greater Good of the People

Top Picks