CBDCs could intensify government scrutiny of financial transactions, OpenAI CEO Sam Altman


  • OpenAI CEO Sam Altman has expressed concerns over the US government waging war on crypto and control over Bitcoin.
  • In his opinion, this threatens the freedom and openness of global cryptocurrencies, citing CBDCs could intensify industry scrutiny by government.
  • Balancing innovation with regulation is crucial to preserve the essence of crypto, which is freedom and decentralization.

OpenAI CEO Sam Altman has expressed concerns over the US government waging “war” on cryptocurrencies as it pushes to control Bitcoin (BTC). This has the CEO of the firm behind the controversial Worldcoin project worried about the future of the US.

Also Read: Worldcoin to stand trial before key government and security officials in Kenya, local media reports

OpenAI CEO on US government waging war on crypto

OpenAI CEO says the US government is a threat to the freedom and openness of global cryptocurrencies. Specifically, he says Central Bank Digital Currencies (CBDCs) could intensify government scrutiny of financial transactions.

Altman’s comments came during his appearance on Joe Rogan's podcast, saying, “I'm very worried about how far the surveillance state could go here.” The ChatGPT executive said this in reference to state capture over money, expressing that he is “super against” CBDCs.

It comes after US legislators and the financial regulators have debated over the digital dollar, CBDC, with Federal Reserve chair Jerome Powell articulating that provisions for such a technology remain distant. His sentiments have drawn support from onlookers in the market, with some calling for balance between innovation and regulation as this would be an enabler to the essence of crypto, decentralization and freedom.

Altman is super anti-CBDCs but super pro-Bitcoin

Despite his dislike for CBDCs, Altman says he is enthused by Bitcoin, saying the idea of having a global currency outside government control is “super logical” in the technology ecosystem. In his opinion, BTC has better odds of becoming a “universally viable currency.”

Meanwhile, the crypto market has had a difficult year bombarded by the US government clampdown. Regulators and some legislators have cracked down on the industry, adding to the weight that keeps market prices stunted. More precisely, clamping down on crypto and crypto-related firms has been an impediment, standing between them and the traditional financial system. This birthed the “Operation Choke Point 2.0 narrative after the 2013 Operation Choke Point where the US Department of Justice (DOJ) discouraged financial institutions from doing business with arms dealers and payday lenders among other firms associated with fraud and money laundering.

As a side note, Sam Altman’s Worldcoin project is at odds with the Kenyan parliament, cited for exploiting the country’s regulatory gaps. In a report by Kenya’s parliament Ad Hoc Committee commissioned against Worldcoin, “the company operated in Kenya, a country with no specific regulations on virtual assets while abstaining from operating in the USA where laws are intricate and continuously evolving. Worldcoin argued that this was due to regulatory uncertainty. With this, the bone of contention is the “exploitation of Kenya’s weaker legal framework in comparison to the USA.”

Cryptocurrency metrics FAQs

What is circulating supply?

The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its inception, a total of 19,445,656 BTC have been mined, which is the circulating supply of Bitcoin. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.

What is market capitalization?

Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value. For Bitcoin, the market capitalization at the beginning of August 2023 is above $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the Bitcoin price around $29,600.

What is trading volume?

Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.

What is funding rate?

Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.

 

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