Republicans Renew Push to Block Central Bank Digital Currency (CBDC)
Republican lawmakers have put forward fresh legislation aimed at preventing the Federal Reserve from developing a central bank digital currency (CBDC) over privacy concerns.
On Monday, Senator Ted Cruz (R-TX) filed the “CBDC Anti-Surveillance State Act” along with four other GOP senators. The bill seeks to clarify that the Fed lacks authority to create a digital dollar.
In a statement, Cruz accused the Biden administration of salivating at the thought of leveraging a CBDC to expand surveillance of personal spending data.
Despite no formal Biden policy existing, CBDCs have become an early flashpoint in the 2024 presidential race.
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Key Details:
- A new Republican bill blocks the Fed’s digital currency powers.
- Senators Cruz, Hagerty, Scott, Budd, and Braun co-sponsored.
- Cruz: Biden “salivates” at using CBDC for surveillance.
- Past GOP efforts have also opposed a central bank digital coin.
Former President Trump also vowed to ban CBDC
Former President Trump, the early Republican front-runner, has also vowed to ban a Fed-issued digital currency if elected.
The Fed itself has tread carefully on the topic, with Vice Chair Michael Barr stating that no movement would happen without Congressional approval. While 130 countries are exploring CBDCs, the Fed remains in the research phase.
For their part, some Democrats see promise in piloting a digital dollar, with Rep. Stephen Lynch (D-MA) highlighting the technology in legislation last September.
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Without explicit constraints, a Fed digital coin could grant regulators enhanced visibility into personal and commercial transactions well beyond existing oversight.
While modernizing the dollar in an increasingly cashless world, CBDCs risk expanding the federal government’s digital footprint in everyday spending habits.
For now, Republican resistance continues to block any advancement of a central bank digital currency as lawmakers demand privacy protections for consumers.
