Central bank digital currencies (CBDCs) may signal the end of physical cash and thus propel interest in cryptocurrency from the darker side of society, according to Mike Dolan, editor-at-large for finance and markets at Reuters.
“Shadow economy” participants, those who use deal mostly in hard cash, are unlikely to be drawn to using a CBDC which may make it harder to stay anonymous, Dolan argues in his column for the news agency.
Dolan suggests that even bitcoin cannot guarantee completely anonymity as coins can be traced from wallet to wallet, so it is unlikely that “legal tender tokens” could be relied on, either.
The “shadow economy,” as described by the International Monetary Fund (IMF), is an ecosystem of consumers and business owners who rely mostly on cash to avoid taxation and regulatory oversight.
This can include everything from sole traders to organized crime, and could be worth more than €2 trillion