Grayscale: Central Bank Digital Currencies Will ‘Neither Replace nor Harm Scarce, Uncomp…

Central bank digital currencies (CBDCs) pose no threat to Bitcoin’s value proposition, instead, they will spur its growth toward mass adoption.

In a new report, Grayscale Investments said CBDCs will never replace BTC because unlike the top cryptocurrency, they can be inflationary and are open to manipulation by central banks

CBDCs are merely digital versions of fiat currencies, which cannot escape government control, it said, adding that government-backed cryptocurrencies simply maintain the status quo.

State control is anathema to bitcoin, an asset created to challenge the conventional financial system and return the ownership of money to the people, beyond the reach of the state.

“CBDCs may censor non-ordained addresses, and central banks will continue to control the monetary policy,” says the report, which examined the potential impact of state-issued digital currencies on the status of bitcoin.

“On the surface, it seems like a digital dollar might displace Bitcoin’s…