Republicans on the House Financial Services Committee approved a bill that seeks to prevent the United States Federal Reserve (Fed), equivalent to the country’s central bank, from issuing a central bank digital currency (CBDC). directly to individuals. The project now goes to the Chamber plenary.
Rep. Tom Emmer, R-Minn. was responsible for presenting the “State CBDC Anti-Surveillance Law”. The purpose of the law is to prohibit the Fed from releasing a digital dollar either directly to individuals or indirectly, through an intermediary.
“I’m extremely proud to have this legislation, which, frankly, I’ve been working on for at least three years,” Emmer said Wednesday.
Project against CBDC in the USA
As Emmer highlighted, a US CBDC could give the government the ability to surveil and restrict Americans’ transactions. That’s because a digital dollar is programmable money controlled by the government
“This is not just alarming – it is completely un-American,” he highlighted.
The Blockchain Association has expressed support for the bill, claiming that a CBDC poses “major privacy concerns,” such as the government’s ability to track purchases, for example.
“The right to financial privacy is protected by the Constitution. We support the CBDC State Anti-Surveillance Act – legislation that seeks to prevent a CBDC from being issued in the United States,” the association said.
The Federal Reserve has been exploring the possibility of issuing a CBDC. However, it has not yet made much progress in this regard, unlike countries like China and Brazil, which already have advanced tests with their respective CBDCs. What the Fed has already done is release reports examining the pros and cons of the US launching a CBDC.
So far, 130 countries, representing 98% of gross domestic product, are exploring a CBDC, according to the Atlantic Council. In Brazil, public and private entities are testing Drex – which was previously called real digital. The CBDC is expected to reach the Brazilian market in 2024, according to the Central Bank of Brazil (BC).