Gustavo Petro

You either die a hero or you live long enough to see yourself become the villain.

Kitco reports that newly inaugurated Colombian President Gustavo Petro’s government intends to create a new digital currency to help prevent illicit financial activity, including tax evasion. The country estimates that tax evasion accounts for 6-8% of Colombian GDP.

The new government is not off to a good start as it floats prohibitive taxes on oil and gas companies, which are responsible for 55% of exports. That's led to some capital flight.

Luis Carlos Reyes, head of the Colombian Tax and Customs National Authority, put the regular spin on a CBDC, saying it would make transactions easier for customers.

But what it will really do is make it easier for governments to track consumers' purchases and tax them.

I don't know the timeline on this, but at some point all societies will need to decide how much they value anonymity (and privacy) in money compared to tax evasion. The same argument for convenience may be used for filing taxes and for those who pay, the ability to automate it might be compelling.

But whether people like it or not, governments always push for more money, more power and more control. At some point in the future, all purchases will be tracked and everything will be digital.

With that the battle might be evolve into CBDCs and 'elicit' cryptocurrencies like bitcoin and stablecoins. That's bullish for BTC in the next few decades because it will shift more elicit activities to crypto.