📰 Table Of Contents
Republican Senators Introduce Bill to Ban Federal Reserve-Backed CBDC
The U.S. Republican senators have introduced a bill aiming to ban Federal Reserve-backed central bank digital currency (CBDC). This legislation emerged amid the Biden administration and Fed’s ongoing interest in studying the potential applications of CBDCs.
Sentiments of Republican Senators
On Feb. 26, Sen. Ted Cruz (R-TX) shared his concerns over the “programmable money.” He expressed worries about “programmable money that, if not designed to emulate cash, could give the federal government significant transaction-level data down to the individual user.”
GOP’s Proposal to Prevent CBDC Issuance
The recent proposal by the GOP marked an escalating debate over Federal Reserve’s stablecoin technology, suggesting that decisions could be shaped by partisan divisions. The legislation planned to prevent the Fed from issuing its own digital currency for use by individuals, as well as prohibiting financial institutions from offering these digital currencies to their clients or members.
Fed Chair Jerome Powell’s Perspective
Fed Chair Jerome Powell emphasized that any decision to introduce a digital currency might be the safest asset for the U.S. public. He mentioned, “Like existing forms of money, a CBDC would enable the general public to make digital payments.” He added that “a CBDC would be the safest digital asset available to the general public, with no associated credit or liquidity risk.”
White House Explores Digital Currency Possibilities
The Biden administration has been actively exploring the potential of cryptocurrencies and digitalized solutions. An executive order issued in 2022 called for comprehensive research into how these technologies could be integrated into the U.S. economy. The White House has encouraged the Federal Reserve to continue its ongoing CBDC research, experimentation, and evaluation.
The Under Secretary of the Treasury for Domestic Finance Nellie Liang also expressed the interest in innovating the current payment ecosystem, stating, “Both real time payment systems and CBDCs present opportunities to build a more efficient, competitive, and inclusive U.S. payment system.”
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
