Tron founder Justin Sun has voiced his disapproval of the Central Bank Bitcoin (CBBTC), claiming that it goes against the core principles of Bitcoin as a decentralized currency. Sun cautioned the crypto community in an X post on Thursday against integrating Bitcoin with centralized platforms. He mentioned that this approach is against the principles laid down in the creation of Bitcoin.
cbbtc=central bank btc. There is no more ridiculous combination in the world than putting central banks and Bitcoin together. I imagine this is a day Satoshi Nakamoto could never have envisioned when creating Bitcoin. https://t.co/bi7EkKznpn
— H.E. Justin Sun🌞(hiring) (@justinsuntron) September 12, 2024
CBBTC Paradox Exposed
CBBTC is not a very popular term, and it is commonly linked to Central Bank Digital Currencies (CBDCs). Sun has used it to emphasize the paradox of concentrating on Bitcoin’s decentralized asset. He pointed out that having a central bank control Bitcoin is contrary to Satoshi Nakamoto’s idea of Bitcoin as a decentralized and non-censoring currency.
Transparency vs Trust
One of Sun’s main issues is that a CBBTC would need to be less transparent. Unlike Bitcoin, which has a clear Proof of Reserves and is audited by independent parties, the Central Bank Bitcoin would be based on trust in a single entity. According to Sun, this contradicts the principle of ‘Don’t trust, verify’, which is the core of Bitcoin. This principle makes users depend on blockchain technology rather than institutions.
Sun also explained that user balances could be frozen in the CBBTC and traditional banks. However, this would be against Bitcoin’s role since it is a decentralized currency no one governs. In the event of a legal subpoena, the government could maintain Bitcoin under CBBTC.
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Furthermore, Sun stated that if the central bank got involved in Bitcoin, it would defeat the whole concept behind it. Bitcoin was not developed to be used by traditional financial institutions but to revolutionize them. This possible centralization goes against Satoshi Nakamoto’s original idea, in which Bitcoin was supposed to be an alternative to centralized systems.
Other crypto community members echo the same sentiments, as in Justin Sun’s comments. While governments are creating central bank digital currencies, concerns are voiced that centralization is slowly entering the crypto sphere.
Sun’s concerns resonate with the risk of centralization, which threatens the essence of cryptocurrency. This has raised concerns within the communities dealing with decentralized digital assets such as Bitcoins. Meanwhile, central authorities are getting more involved in regulating digital currencies. The issue of Bitcoin’s decentralization remains relevant.
