Sen. Ted Cruz Introduces Bill Prohibiting Fed From Developing CBDC
Bills opposing a central bank digital currency (CBDC) in the U.S. have been introduced at both the federal and state level.
Sen. Ted Cruz, R-Texas, announced a bill Tuesday (March 21) that would prohibit the Federal Reserve from developing a direct-to-consumer CBDC.
“The federal government has no authority to unilaterally establish a central bank currency,” Cruz said in a Tuesday press release. “This bill goes a long way in making sure big government doesn’t attempt to centralize or control cryptocurrency and instead, allows it to thrive in the United States.”
Cruz previously introduced the bill a year earlier, and both that bill and this year’s are co-sponsored by Sens. Mike Braun, R-Ind., and Chuck Grassley, R-Iowa.
The latest introduction of the bill came a day after Florida Gov. Ron DeSantis proposed legislation that would prohibit the use of both federal and foreign CBDC as money and called on other states to do the same by adding such provisions to their uniform commercial codes.
Backers of the bill in the Senate said a direct-to-consumer CBDC could be used as a surveillance tool by the federal government, would centralize users’ financial information and leave it vulnerable to attack, and would lack cash’s benefits and protections and some existing cryptocurrencies’ control and security, according to the Tuesday press release.
“The American people ought to be able to spend their money how they choose without the possibility that every transaction could be tracked by the government,” Grassley said in the release. “Policy this impactful should be made by Congress, not government bureaucrats, and our bill would ensure that no one is snooping on the finances of hardworking Americans.”
This proposed bill comes about a year after President Joe Biden said that he would sign an executive order aimed at establishing a single, government-wide policy on cryptocurrencies and other digital assets and that the decision to create a CBDC — while not yet made — is a priority.
It also comes about six months after the Treasury Department delivered a future of money white paper to the Biden administration that had a great deal of space dedicated to the topic of what a U.S. CBDC would look like.