Yesterday Senator Ted Cruz backed a Bill to block the launch of a retail central bank digital currency (CBDC) in the United States. He was joined by four other Republican Senators: Hagerty, Scott, Budd and Braun. The ‘CBDC Anti-Surveillance State Act’ was introduced by Congressman Emmer, the Republican party whip. It passed a vote of the House Financial Services Committee late last year.
This is the third time Cruz has introduced legislation to block a CBDC. He did so in 2022 and 2023 with Bills that were even shorter than the latest two-pager. The Bill mainly targets retail CBDC. However, its loose wording might also catch a wholesale CBDC. “The Biden administration salivates at the thought of infringing on our freedom and intruding on the privacy of citizens to surveil their personal spending habits, which is why Congress must clarify that the Federal Reserve has no authority to implement a CBDC,” Senator Cruz said.
Several trade associations, including the American Banking Association (ABA), backed the Bill. “ABA has long believed that a CBDC would pose significant risks to our financial system that would outweigh any potential benefits, including undermining the critical role that banks play in extending credit and powering the economy,” said Rob Nichols, President and CEO of the ABA. In addition to these Congressional moves, there is a wave of legislative proposals at the State level.
At the start of the month, we wrote about 11 states with pending anti-CBDC legislation, but that has now grown to 13. Three states have already passed laws.
