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(Kitco News) - As central banks around the world work to develop central bank digital currencies (CBDCs) intended to be used by the public, recent surveys show that opinions on digital fiat vary greatly by country, with U.S. citizens highly skeptical of a digital dollar, while a majority of Canadians are open to using a digital loonie.
According to the results of the Cato Institute 2023 CBDC national survey conducted in conjunction with YouGov, only 16% of Americans support the adoption of a digital dollar while 34% came out strongly against it. 49% of those surveyed have yet to form an opinion on the matter.
The large percentage of undecided respondents was partially attributed to the fact that only 28% of Americans are familiar with CBDCs while 72% are not.
Breaking it down by political party, Democrats (22%) were found to support the adoption of a digital dollar at twice the rate of Republicans (11%), with 53% of Republicans explicitly opposing a CBDC versus 22% of Democrats. “However, once benefits and risks are considered, both Democrats and Republicans are wary of a CBDC,” the survey found.
American men (22%) were twice as likely to support a digital dollar as compared to women (11%), and nearly a third (32%) of people under age 30 support a CBDC compared to 25% of 30–44-year-olds, 8% of 45–64-year-olds, and 3% of Americans over 65.
While CBDCs are advertised as enhancing financial inclusion in the economy, the data showed that lower-income groups do not support a CBDC more than higher-income groups. Among those earning less than $20,000 a year, 19% support a CBDC, while 21% of those earning more than $100,000 a year support one.
The biggest concern for respondents revolved around the level of control a digital dollar would give the U.S. government. 74% said they would oppose the adoption of a CBDC if it meant that the government could control what people spend their money on, and 68% said they would oppose it if the government could monitor their spending.
68% also said they would oppose the digital dollar if it abolishes all U.S. cash, 64% would oppose it if the government could charge a tax on those who don’t spend money during recessions, and 59% said they would reject it if the government could freeze the digital bank accounts of political protesters.
A majority of both Democrats (71%) and Republicans (82%) said they would oppose a CBDC if the government could control what people spend their money on and when, and both groups (D-61%, R-82%) were opposed to the government being able to see what people buy with the digital currency.
When it comes to potential advantages, 42% of respondents said they would support a digital dollar if it reduced the risk of money laundering and fraud, and 40% would back the CBDC if it meant that the government could ensure welfare payments were spent on their intended purpose.
Overall, 76% of Americans said the “government should not issue a central bank digital currency because it would potentially allow the government to monitor what people buy and potentially control how they spend their money.” 24% said that the “government should issue a central bank digital currency because it would reduce financial crime and other illegal activity and would increase access to the financial system.”
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| North Carolina joins FL, SD against digital dollar as states becomes key CBDC battleground |
Canadians more open to the idea of a digital dollar
While Americans are not too keen on the creation of a digital dollar, the results of a survey conducted by WealthRocket regarding the potential creation of a CBDC by the Bank of Canada (BoC) found that “59% of Canadians are willing, to varying degrees, to use a CBDC if one ever becomes available, and 25% would use it in place of cash.”
WealthRocket’s survey was conducted during the public consultation period announced by the BoC, which ran from May 8 to June 19, and sought to get the public’s input on creating a digital Canadian dollar.
The survey asked Canadians a variety of questions related to CBDCs and spending, including how they currently make day-to-day transactions, in what ways they would or would not use a CBDC, and whether they trust the government and other institutions to safeguard their data.
Out of the 59% that said they are willing to use a CBDC, 43% are somewhat willing, 11% are very willing, and 5% are extremely willing. On the opposite end of the spectrum, 25% said they’re not at all willing to use a central bank digital currency in Canada. 16% said they didn’t understand enough to make an informed decision at the time.
A major concern for 45% of respondents was that a CBDC could result in cash being phased out. When respondents were asked if they would use a CBDC in place of cash, 38% said maybe, 25% said yes, 12% said no, and 25% said they’d continue using cash alongside a CBDC.
Issues related to privacy also ranked high on the list of concerns, including the potential for fraud (56%), the risk of cyber attacks (53%), and the loss of control over personal finances (39%).
The Canadian government's response to the Freedom Convoy protestors in Ottawa in early 2022, which included the freezing of bank accounts belonging to some protestors, likely contributed to concerns over the loss of control over personal finances, the report said.
Despite their concerns, 51% of Canadians are somewhat confident in the Bank of Canada to safeguard their privacy if a CBDC is ever implemented. 35% expressed concerns about a lack of anonymity and transaction tracking.
Survey respondents were also given an open-ended question about the benefits they saw with the creation of a digital Canadian dollar. The top responses were related to convenience and safety.
“Many respondents mentioned the convenience of digital transactions [and] highlighted the ease of online purchases and transfers between companies and people,” the report said. “Several respondents pointed out the potential for more secure transactions with digital currency, including the idea that one can't be robbed if they don't have physical money on them.”
