Would you still use crypto if all of your transactions, CEX and Defi, had to settle with or through a CBDC?

A concern that I see coming down the line is the ongoing pilots and eventual building-out of CBDCs. As much as we all hate to admit it, they’re coming. And while it’s tempting to think that most crypto users could just avoid using them, what if that weren’t the case?

As CBDCs arrive em masse, with the ability to embed compliance and digital identity features, governments (and banks) will be keen to use them for oversight of financial transactions. Taxes could be collected immediately on some transactions for instance - which financial institutions might find appealing to be able to comply instantly with financial regulations.

This leads me to my main point: in the ongoing battle for control over crypto, which so far has been a challenge even for the SEC, governments have a potential dangerous ace up their sleeves. Once they have fully rolled out CBDCs, they could enact laws or regulations to force all CEX user cash outs to a CBDC and even swaps first through a CBDC in order to legally operate within a said country. The exchange would have little choice but to comply. And citizens of course would first have KYC through their bank to utilize the CBDC. It would finally move the control over crypto to governments that’s been impossible thus far. Similarly, a government could regulate any Defi exchange offering services for its citizens to cash out or swap through their CBDC, thus tracking (and potentially taxing) all user transactions in real time. A VPN might not be an option to bypass such a restriction - within the US, the proposed RESTRICT Act’s language could make the use of a VPN illegal in the future.

This may all seem far off, but given the track record of crypto and governmental attempts to control it so far, it may not be. Would this leave peer to peer as the only true decentralized finance available? Would you still use crypto if you had no choice within your country but to interact with a CBDC for all of your crypto transactions?