Down The Rabbit Hole

What links a former US president and recently anointed Republican candidate for the 2024 presidential election and an obscure newspaper from the small, bucolic town of Totnes in the West of England? The surprising answer is the development of government-backed cryptocurrencies, commonly known as Central Bank Digital Currencies (CBDCs) – or more precisely, a conspiratorial suspicion of what their development and introduction might herald. Throw in the views of leading US political voices such as Ron DeSantis and Ted Cruz, UK chancer-in-chief Nigel Farage, a former BBC sports pundit, the brother of a former UK Labour Party leader and European entrepreneur Kim Dotcom, and the development of CBDCs faces some vocal and influential headwinds. But why is this? Why has the grey and technical world of central banking become a magnet for conspiracy theorists? In this article, based on a review of literature and dives down various rabbit holes, we will first assess the various forms of opposition to CBDCs – ranging from the genuine to the self-serving, alarmist and fantastical. We will then consider how the conspiracy theorists propose addressing their concerns could be addressed, before concluding with what those that are developing CBDCs might say in response – if they are to be believed.

Central Bank Digital Worries?

The conspiracies confronting the development of CBDCs by central bankers fall into a range of increasingly extreme categories – from those rooted in potentially realistic concerns, to those that are highly dystopian and removed from reality. Despite this spectrum of opinion, these conspiracy theories share some common ground, central to which is the fear of losing privacy, freedom and individual autonomy. Such fears in turn span a range of perspectives reaching as far as a belief that CBDCs are part of a desire to enforce the World Economic Forum’s (WEF) “Great Reset” (an unfortunate and conspiracy-inspiring choice of name by the WEF) and to support the capitalist and elite takeover of global governance. To get a better understanding of this array of conspiracies, it is helpful to consider them in three different categories.

The Seemingly Concerned Activists

This group is deeply worried about the potential effects of CBDCs on their lives and draws inspiration for action from CBDC conspiracy theories. These initiatives start with simple steps, like producing graffiti to warn people of the dangers of digital currencies or staging demonstrations opposite Downing Street in London, as they seek to raise awareness of the perceived risks of CBDCs in an entirely non-digital and accessible manner. They have no particular personal goal in taking such actions beyond expressing their resistance to these new financial developments.

The potential for CBDCs to control how a user spends their money is a central concern of many who oppose their development. This can be seen, for example, in a petition published on the UK Parallel Parliament website, which closed in April 2023. The petition directly focused on this fear of control, by objecting to the inclusion of any sort of programmable aspect in a UK CBDC that might grant the Bank of England control of use. Over 31,000 signatures were added to the petition, underlining a core and widely held concern that CBDCs might be used to impose limitations on how individuals can spend their money in the future.

Joining these concerned members of the general public and their fears of the loss of privacy and control can be found US political voices such as Ron DeSantis, the governor of Florida, as well as Ted Cruz, the Senator for Texas, who rank among others who have already introduced – or plan to introduce – legislation against CBDCs in their states in order to address these perceived concerns. Of course, nothing is always as it appears in the world of conspiracies, and thus these seemingly passionately held views must be considered alongside their proponents’ support for and close cooperation with groups such as the Blockchain Association or the American Bankers Association. Are their concerns real, or might they be based on more mundane commercial considerations? Similar questions arise with vocal opponents such as social media influencer and Bitcoin booster Layah Heilpern – who receives her entire income in Bitcoin – who declared that “Central Bank Digital Currencies will strip you of all your freedoms. When you don’t have freedom of money you don’t have freedom of anything”. The same applies to Tulsi Gabbard, a US politician, Army Reserve officer and political commentator, who used her speech at the Bitcoin 2023 conference in Miami to spread concerns about CBDCs and simultaneously promote the significance of Bitcoin. Ultimately, this category of conspiracy theorist seems mainly concerned with sowing distrust in CBDCs as a means of maintaining the financial system’s status quo – something they may, perhaps, benefit from themselves.

The Political Rabble-Rousers

This category mainly encompasses US and European politicians, and other high-profile opinion-formers, who – whether they believe them or not – tap into CBDC conspiracy theories to skilfully engage their bases. What their genuine beliefs are, or from where they source their knowledge, is often unknown, but this does not matter since their audience is often not directly interested in evidence but rather in voices that confirm their personal views and opinions. Feeding the conspiracy theories held by their supporters can be a valuable tool to garner greater attention, make more sales of merchandise, or – in the case of politicians – get more votes.

The most prominent person to use this approach is former US President Donald Trump, who promised in a presidential campaign speech in New Hampshire in January 2024 to “protect Americans from government tyranny”. In his speech, Trump portrayed CBDCs as a threat to freedom, claiming that the federal government would have “absolute control over your money” – meaning that it “could take your money and you wouldn’t even know it’s gone”. Attempting to make this a partisan issue, Trump said: “You know what ‘they’ are doing”. However, like others that have taken a vocal stance against CBDCs, it is notable that Trump reportedly owns around $3 million in cryptocurrencies and has promoted the trading of non-fungible tokens (a form of online digital collectable) trading.

Trump has not been alone in using CBDC conspiracies in political campaigning. Indeed, it is most likely an idea he co-opted from entrepreneur Vivek Ramaswamy, an early challenger for the Republican presidential candidacy, who claimed that he had explained the dangers of CBDCs for the country’s liberty to Trump.

Stoking fears of government control via CBDCs is not exclusive to Republican Party presidential candidates, either. Independent campaigner Robert F Kennedy Jr has likewise expressed his concern regarding a digital dollar and is worried about the possibility of governmental surveillance and control, citing the example of China’s CBDC and its alleged connection to the country’s social credit system.

As with other forms of mis- and disinformation, social media platforms like X serve as a catalyst for further interpretation and amplification of CBDC conspiracy theories

Crossing the Atlantic, similar concerns have been expressed by British broadcaster and former politician Nigel Farage and by Dutch Member of the European Parliament Marcel de Graff. Farage has claimed that “Central Bank Digital Currencies will give the state total control over our lives. This must be resisted”, while de Graff has similarly argued that “If you don’t comply with the totalitarian regime, it will have your bank accounts closed. CBDC will make it even easier”.

To summarise, members of this group mostly worry about governmental control and surveillance, and use their platforms to stoke anti-government sentiment by raising concerns about loss of control over the use of personal money.

The Dystopians

While the previous categories consist of individuals who may be harnessing CBDC conspiracy theories for a variety of personal gains, this final category goes beyond mere issues of government control and includes a diverse array of boosters including publications such as The Light and 21st Century Wire and people like former footballer and BBC sports reporter David Icke and the German/Finish internet entrepreneur Kim Dotcom. For example, Icke has argued that “I could see that the plan was in this great reset… to introduce a digital currency controlled by the system so that they can just take what they want”, while 21st Century Wire even goes as far as to claim that “Time is running out. No, you didn’t vote for it, nor were you consulted about it. And yet, it might be the most fundamental power grab by global elites in the history of modern civilization”. As can be seen, what mainly differentiates this group from the others is their highly dystopian view of CBDCs, seeing government-controlled digital currencies as part of a greater plan by global elites, such as the WEF’s “Great Reset” or the UN’s Agenda 2030, the latter of which allegedly uses the Sustainable Development Goals not to promote equality, but as an excuse to eradicate a white and Christian society.

Their arguments against CBDCs are wrapped up in a broader conspiracy narrative that sees corporations and elites designing programmes – including Covid-19 vaccines – as a means of enslaving humanity and securing absolute control over citizens, even going as far as to compare them to weapons of mass destruction. They argue that the financial system of the West has been proven unsuitable and reached its limits, and thus central bankers have had to create an alternative system that supports a global totalitarian movement to control people. These beliefs are based primarily on the interpretation of official statements by central banks and politicians, as well as the books of Klaus Schwab, chairman of the WEF. Naturally, objective evidence to prove their claims is entirely absent.

As with other forms of mis- and disinformation, social media platforms like X serve as a catalyst for further interpretation and amplification of these theories. For example, on examining one of Kim Dotcom’s posts about the Great Reset, one can quickly see in the comments section or through the 6,900 retweets how opinions are intensified, further interpreted and spread; the same happens again with comments and reposts, leading to a self-reinforcing cycle of spreading conspiracies.

What differentiates this final group from the others is that their fear surpasses the mere concern of potential governmental influence and loss of control over the use of money. This group fears the development of a dystopian world of which CBDCs are just one symptom – a world which, in the view of Kim Dotcom, is a created hell, and where – in the words of The Light – “[…] we will, in effect, be slaves”.

What are Conspiracy Theorists Proposing Should be Done?

So, what are the conspiracy theorists in these three categories proposing to do against the introduction of these “dangerous” digital currencies?

Like their range of fears, the conspiracists have a variety of different approaches in mind. Piers Corbyn, a British weather forecaster and former politician, proposes a simple solution: pay in cash if you want to avoid the perceived controlling threat of electronic money – something he practiced himself when he refused to pay by card in a cashless supermarket, forcing a staff member to take his coins as payment.

This refusal can be seen as a first step in the revolution against the digitalisation of money, even if it is merely to reject the use of widely adopted and accepted card payments. The importance of cash, its continued existence, and its use as a daily monetary – and anonymous – transactional means are significant elements that run through all proposed opposition to CBDCs. Using physical money is the most logical way to avoid succumbing to the introduction of CBDCs and the simplest form of resistance, particularly as most governments have committed to continuing to provide for and service those that prefer physical cash over electronic payments.

For this reason, The Light proposes only ever using bank cards to withdraw cash from ATMs, and not to use them as a form of payment. Payment apps also face opposition from The Light, as they are seen as already collecting too much data and constituting the thin end of a wedge of incremental government financial surveillance, with the publication claiming that central bankers might argue that “It’s because everyone uses apps and cards anyway, [that] this is the logical next step”.

Around 24% of the UK population would take direct action in the form of protests or rallies against the introduction of a digital pound

As well as taking individual action, opponents of CBDCs – regardless of their motivations – promote the importance of spreading the message of resistance and sharing these concerns with networks, friends and family. Social media is thus integral to the “resistance” movement and the dissemination of anti-CBDC propaganda. The irony behind this is that by accepting platforms’ terms and conditions and downloading their apps, people already give away vast amounts of their personal data, providing insights into their activities that can be sold and used to profile users’ interests in just the same way that the users fear central bankers might do with their CBDCs.

There are also more proactive proposals for resistance against the introduction of CBDCs. A study by King’s College London shows that around 24% of the UK population would take direct action in the form of protests or rallies against the introduction of a digital pound, and 15% of these people even say violence in such protests would be acceptable. Only a few of these people are direct readers of conspiracy theory-spreading newspapers, with most gathering their information from social media.

Another robust proposal – which in the case of some US states is already a reality – is the creation of legislation against the introduction of CBDCs. Donald Trump and Robert F Kennedy Jr have both used such an approach in their presidential campaigns. Trump said: “As your president, I will never allow the creation of a central bank digital currency”. Ron DeSantis, Florida’s governor, already went a step further: he successfully introduced Senate Bill 7054, which prohibits the use of CBDCs, at least in Florida. For this act, he was supported by most officials of the state of Florida, who all see CBDCs as an attempt by the Biden administration to increase governmental control and to secure the possibility of using it as a weapon against the US people. In their view, the introduction of legislation is the only way to protect Florida’s citizens from overreach by the federal government.

How Might the Grey Suits Respond?

Switching perspectives, what do central banks and other financial operators have to say about all these accusations and dystopian visions of the future? Central bankers indeed understand that the introduction and idea of CBDCs might rattle people, and that they are worried about governmental surveillance. However, awareness of the population’s concerns does not necessarily make life easier for central banks, because every word can be misinterpreted and used against them, as we have seen in the previous sections. Evelien Witlox, the programme manager for the digital euro at the European Central Bank, said that “These are people of our society, and we would like to take their concerns away – the problem is how we can do that”.

Mithra Sundberg, the head of the Swedish central bank’s CBDC project, has argued that “Neither the state nor the central bank have any interest in looking at how people pay for things”, and that “Privacy is an extremely important question when you’re talking about all types of digital monies”. The Bank of England has likewise clarified that “A digital pound would have the same (or stronger) privacy protections as bank accounts, debit cards or cheques” and that “[an] individual’s personal details would not be known by the Government or the Bank of England”. In response to the petition of the UK Parallel Parliament about the programmable aspects of CBDCs, the UK government stated that “Neither the Bank of England nor the government would be able to programme CBDC or restrict how money is spent. If there was end-user demand for programmability features, then any programmability features would be designed by the private sector wallets, and users would have the option to use them if they so wished”.

The concern that digital currencies will become the only possible payment method and that there will no longer be any other payment options is also a point that several of the world’s central banks are trying to address. For example, in a joint report published by the Bank for International Settlements, it is argued that “any CBDC ecosystem would involve both the public and private sector”. The central banks are also supported by the operators that – according to the conspiracies – they want to eradicate; for example, Mark Barnett, the European president of Mastercard, made it clear that he was not concerned that current payment systems would be replaced.

Thus, central banks are trying hard to ensure citizens’ trust and emphasise the benefits of CBDCs, such as facilitating the combating of terrorism financing, crime and tax evasion. One sentence, however – depending on the wording – can shake the whole foundation of trust, such as the statement by the Bank of England and the Treasury that a digital pound “would not be anonymous because the ability to identify and verify users is needed to prevent financial crime”. This pours petrol on the concern that, unlike physical money, users will indeed lose their privacy.

Where the banks are seeking to combat crime, which requires some form of user identification, the conspiracy theorists see this as confirmation of planned state surveillance and control. Central banks must, therefore, pay close attention to their communications to avoid making contradictory statements – or statements open to perverse interpretation – that reinforce the assumptions of conspiracy theorists. Robert Holzmann, Governor of the Austrian Central Bank, made clear that the narratives surrounding CBDCs are problematic because of their negativity: “What is still missing is a convincing storyline for the digital euro, something which we can put up in front of people”.

Whether central banks will succeed in convincing the public about the value and benefits of CBDCs and present a storyline that is immune to conspiracy distortion remains to be seen. What is clear is that the grey suits will need to be far more dynamic in their communication if they want to roll back the growing prevalence of distrust and conspiracy surrounding their intentions.

Tom Keatinge is the founding Director of the Centre for Finance and Security (CFS) at RUSI, where his research focuses on matters at the intersection of finance and security.

Fiona Koeckler is an MA International Relations student at the Department of War Studies at King’s College London.