According to a recent report from Fox Business ReportIn response to the growing momentum behind central bank digital currencies (CBDC), House Majority Whip Tom Emmer will reintroduce the Central Bank Digital Currency Anti-Surveillance Act.
The Republican-backed bill seeks to prevent the Federal Reserve and its member banks from issuing digital versions of the dollar and using it to conduct monetary policy.
CBDC issuance conflict sparks political showdown
Global interest in digital forms of a country’s fiat currency There has been a surge in the past few years, with as many as 130 countries (representing 98% of the global economy) exploring the possibility of digitizing their currencies.
11 countries, including China, have fully implemented central bank digital currencies. However, despite belonging to the broader digital asset class, CBDC has sparked controversy among cryptocurrency enthusiasts and conservatives.
For that matter, the Biden administration has no plans to issue a digital version of the dollar. However, as the Fed takes preliminary steps, such as studies and pilot programs, to explore the possibility of implementing a CBDC, Republican lawmakers remain skeptical.
CBDC has become a focus of talk among Republican presidential candidates in the 2024 election, including Ron DeSantis and Vivek Ramaswamy. Democratic presidential candidate Robert F. Kennedy Jr. has also condemned CBDCs, calling them “a tool of control and oppression.”
According to the report, Emmer’s reintroduced legislation is an updated version of a bill he introduced earlier this year and reflects the rapidly evolving digital asset policy landscape. The bill, co-sponsored by 49 congressional Republicans, has two major changes compared with the original text.
First, it bans “intermediary CBDCs” — CBDCs issued by the Fed but managed by retail banks and other financial institutions rather than directly controlled by the Fed. This is similar to the model adopted by China’s digital yuan.
Second, the new version eliminates the requirement that the Fed report to Congress any central bank digital currency pilot programs or research, and such issues will be addressed in separate bills, such as Rep. Alex Mooney’s Digital Dollar Pilot Prevention Act. .
Similar anti-central bank digital currency legislation has been introduced in the Senate, including Mike Lee’s Ban CBDC Act and Ted Cruz’s bill, which aims to prevent the Federal Reserve from issuing CBDC directly to individuals.
However, given Democratic control of the Senate and White House, the chances of any anti-CBDC legislation passing this year appear slim. Still, Emmer’s supporters hope the bill will increase public awareness of the potential drawbacks associated with CBDCs.
Emmer expressed his concerns about the Biden administration’s stance, saying it would sacrifice Americans’ right to financial privacy in exchange for a surveillance-style CBDC.
He emphasized the importance of the legislation to curb the power of unelected bureaucracies and ensure that U.S. digital currency policy upholds values such as privacy, individual sovereignty, and free market competitiveness.
With the bill reintroduced, the House Financial Services Subcommittee is scheduled to hold a hearing on CBDC later this week.
Featured image from iStock, chart from TradingView.com
