US House Blocks Federal Reserve’s Plans for Digital Dollar
The US House of Representatives has voted to pass a bill that prohibits the Federal Reserve from issuing a digital dollar without explicit authorization from Congress. The legislation, known as the CBDC Anti-Surveillance State Act, was approved with a vote of 216 to 192. Republicans expressed concerns about the potential control the government could have over citizens’ finances with a digital dollar.
While the Federal Reserve has not yet proposed a solid plan for a digital dollar, the House vote reflects ongoing concerns among Republicans, including former President Trump, about potential government overreach with such a system. House Majority Whip Tom Emmer, who introduced the legislation, argued that a digital dollar could be used as a surveillance tool by the government, allowing them to track transactions and potentially restrict activity they deem politically undesirable.
Trump has also expressed strong opposition to a central bank digital currency, vowing to block its creation if he is re-elected. He has warned that such a currency would give the federal government absolute control over people’s money, allowing them to take money without the individual’s knowledge.
Earlier this week, the American Bankers Association urged House leaders to support the bill. The vote marks a significant difference from the previous floor vote, where a bill focused on crypto market regulation, called the Financial Innovation and Technology for the 21st Century Act, was passed. This bill grants more authority to the US Commodity Futures Trading Commission and outlines the Securities and Exchange Commission’s approach to the sector.
While the crypto industry celebrates the passage of the FIT21 bill, challenges remain. The bill will need a companion version to be introduced in the Senate, where it may face opposition from critics such as Senator Elizabeth Warren. Additionally, President Joe Biden has expressed concerns about the lack of consumer protections in the bill, indicating that further revisions may be necessary before it becomes law.
