It was all a dream. After drawing rebukes from banking authorities, including the ECB president and Estonian central bank governor, Estcoin appears dead in the water.
In the cryptocurrency echo chamber, social media users – and reporters – sometimes exaggerate claims of government adoption. As a journalist, it's difficult to walk the line between covering innovative projects championed by exuberant creators and ensuring that one does not contribute to a fundamentally flawed narrative.
Over the last year, central bank digital currencies[1] (CDBCs) have become a hot topic in the cryptocurrency universe. For instance, many crypto-fanatics seem to believe that "Fedcoin[2]," a theoretical cryptocurrency backed by the US Federal Reserve, is a looming possibility. However, officials at the US Fed have clearly explained[3] why a CBDC is likely a poor fit for the American economy and even questioned the viability[4] of stateless cryptocurrencies like bitcoin.
While the US government hasn't readily embraced a CBDC, other governments have notably expressed enthusiasm. During the last year, we've reported on varying degrees of CBDC interest from China[5], India[6], Russia[7], Sweden[8], and the Marshall Islands[9], among several other countries. Estonia is another country making that shortlist[10], mostly because of one official's ambitious plan[11] for "Estcoin," a proposed "crypto token[12]."
However, the purpose of Estcoin has never been very clear. According to Reuters[13], Estonia's managing director of e-Residency, Kaspar Korjus[14], claimed that the token could be used for rewarding services in the country's e-resident community, verifying online identity, or as a means of payment pegged to the euro.
More importantly, Estcoins
