Republican Senators Propose Legislation to Prohibit CBDC: The Hill
The U.S. Republican senators have introduced a bill aiming to ban Federal Reserve-backed central bank digital currency (CBDC).
As reported by The Hill, this legislation emerged amid the Biden administration and Fed’s ongoing interest in studying the potential applications of CBDCs. On Feb. 26, Sen. Ted Cruz (R-TX) shared his concerns over the “programmable money.”
Cruz, GOP senators double down on anti-central bank digital currency legislation.https://t.co/IPUgLoIXHz
— Ted Cruz (@tedcruz) February 27, 2024
“Programmable money that, if not designed to emulate cash, could give the federal government … significant transaction-level data down to the individual user,” said Cruz.
According to The Hill, the recent proposal the GOP marked an escalating debate over Federal Reserve’s stablecoin technology, suggesting that decisions could be shaped by partisan divisions.
The legislation put forward by the Republican senators planned to prevent the Fed from issuing its own digital currency for use by individuals, as well as prohibiting credit unions, retail banks, financial cooperatives, and other financial institutions from offering these digital currencies to their clients or members.
Fed Chair Jerome Powell emphasized that any decision to introduce a digital currency might be the safest asset for the U.S. public. But to proceed with the issuance of the digital dollar, the Fed will require legislative approval from Congress.
“Like existing forms of money, a CBDC would enable the general public to make digital payments,” said Powell. “As a liability of the Federal Reserve, however, a CBDC would be the safest digital asset available to the general public, with no associated credit or liquidity risk.”
The Biden administration, in addition,
