DOES IT MATTER FOR CBDC DESIGN? PRIVACY-ANONYMITY PREFERENCES FROM THE SIDE OF HIERARCHIES AND EGALITARIAN CULTURAL PATTERNS

Abstract

Evolution of digital money demonstrates that CBDC (Central Bank Digital
Currency means a digital form of traditional fiat currencies) design is really
challenging. While technically possible CBDC solutions are visible, much of
institutional aspects are rest to be unsolved. One of the issues is a degree of
privacy and anonymity. All historical forms of money had intrinsic property of
non-traceability of transactions and only now this feature of non-digital money
is recognized as strong institutional advance. At the same time, privacy and
anonymity preferences could relate to cultural attitudes. However, money may
distort expected logical relations between such patterns like “less hierarchies
more privacy-anonymity” or “more egalitarianism less privacy-anonymity”.
This potentially means that money may posit extra propensity to privacyanonymity
that is going beyond the cultural attitudes. Basing on the survey, we
demonstrate some contradictions in how respondents perceive the preference
of functional usability over anonymity of transactions. The same is relevant
when cultural patterns are taken into account. It is more likely to find cultural
closeness across respondents from different regions than strong determinacy of
privacy-anonymity preferences by propensity to hierarchies or egalitarianism.
Additionally, we checked hierarchies or egalitarianism attitudes by additional
questions and found some mixed results. Also, we found some conformism
culture (meaning unstable preferences) and rely it with lack of trust in public
institutions. When centralized money are less trusted people faster agree to
sacrifice anonymity in the benefits of functionality. The main take away is that it
is unlikely to expect the unity of optimal CBDC design across countries. Aside of
behavioural distortions, culture still matter and it is likely to expect future variety
of digital money from functional usability privacy-anonymity trade-off.