Press release: Nym Advisor Andrés Arauz denounces FATF design guidance on CBDCs and leads urgent…

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International standardisation body ISO/TC68 better positioned to lead on standards of CBDCs for the benefit of global society

Addis Ababa, Ethiopia, 30 November 2022 — Today, Nym advisor Andrés Arauz, former director of Ecuador’s central bank and 2021 presidential candidate, called for the design of CBDCs (central bank digital currencies) to be moved to a more open, democratic, and privacy-respecting standards process at the United Nations Internet Governance Forum (IGF).

Arauz stated his immediate intention to join the already existing International Standards Organisation TC68/AG5 Working Group on central bank digital currencies where governments from the global south are currently absent. Even cryptocurrency advocates can take an active role, as they can join through their national standard setting bodies as members.

This is in response to the increasing trend of countries declaring that privacy protection will not be included in the design of CBDCs as recommended by FATF (Financial Action Task Force) under the guise of anti-money laundering. The FATF is completely opaque, dominated by geopolitics, and is heavily influenced by the Wolfsberg Group, a club of the largest US and European banks.

In the interest of social good, guidance from a standards body that has the responsibility to include any nation state wanting to participate, will be less asymmetric to everyone who will be impacted by CBDCs. Deeper involvement in ISO/TC 68 will allow all relevant stakeholders, including both the Internet Engineering Task Force (IETF) and the newer generation of privacy-focussed Web3 experts, to set innovative technical standards for CBDCs and decentralised alternatives, providing financial freedom to those who need it while mitigating the risk of illegal activities.

“CBDCs will be legal tender and need democratic safeguards that guarantee the human right to privacy, their standards should not be defined by the FATF — an unaccountable, ineffective and opaque body. Stakeholders from civil society and alternative finance should get involved to embed these human rights in the CBDC hardware and software standards,” Arauz said.

This was announced alongside Nym CEO Harry Halpin and Open Knowledge Foundation CEO Renata Avila at the United Nations Internet Governance Forum (IGF) 2022 in Ethiopia, during Town Hall #99 The Data of Money: Blockchains and/or Surveillance.

Halpin added: “CBDCs could easily become tools of mass surveillance and control to repress political dissidents and entire nations. It’s imperative that the cryptocurrency industry get involved in this discussion over CBDC standards at the highest level, by teaming up with countries from the Global South that need to throw off the yoke of colonial banking systems to serve their own people rather than the imperialist overlords of the FATF.”

The IGF session focused on the current state of financial surveillance and new routes to privacy-preserving CDBCs and financial autonomy led by the global south. CBDC standards should allow both nation-states and non-nation state actors to interoperate and include privacy by design, which has been disingenuously dismissed under the guise of money laundering concerns even though privacy will be needed for national security purposes and to respect basic rights. Violations of an individual’s privacy rights through mass financial surveillance should be taken seriously and respected.

Watch the livestream: https://www.intgovforum.org/en/content/igf-2022-live

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About Nym:

Nym is an open-source, incentivized, and decentralized platform that protects privacy at the network level of any application, wallet or digital service. Nym protects against traffic pattern analysis and metadata surveillance. More: https://nymtech.net

About Andrés Arauz:

Arauz has been a prominent figure in leading the drive on technological and monetary disintermediation. Motivated to reduce the bureaucratic need for the central bank to hold and distribute large amounts of physical dollars, he was one of the first to experiment with CBDCs, piloting Dinero Electrónico as then-Director of Ecuador’s central bank. Arauz is a force driving the need for open standards for CBDCs and global payments. Contrary to most in government, he is a strong advocate for the benefits of free and open source software. As Minister of Knowledge and Human Talent, he transitioned the Ecuadorian ministry’s internal systems from closed software systems. Read his paper on The Data of Money: https://www.tni.org/en/publication/the-data-of-money and Ecuador’s CBDC: https://www.sciencedirect.com/science/article/pii/S2666143821000107

Media contact:

Candice Teo, candice@nymtech.net

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