The project to prevent the introduction of a digital currency by the Federal Reserve moves forward.
On April 2, the House Financial Services Committee approved the “CBDC Anti-Surveillance State Act” with 27 votes in favor and 22 against, a bill promoted by Republican Representative Tom Emmer of Minnesota.
The legislation aims to prevent the Federal Reserve from issuing a digital dollar, basing its motivations on the risks of financial surveillance and the potential transformation of the central bank into a retail banking entity. The bill also prohibits the Fed from indirectly implementing a CBDC through intermediaries and explicitly bans the use of digital currency as a monetary policy tool.
During the discussion session, Emmer stated that “the government should never be involved in creating financial surveillance tools.” He then added:
“Unlike decentralized cryptocurrencies, such as Bitcoin, a CBDC is a digital form of sovereign currency that is issued, monitored, and managed by a central bank.”
The differences between Bitcoin and CBDC
The representative emphasized that a CBDC essentially represents “government-controlled programmable money that, if designed without privacy protections of cash, could give the federal government unilateral authority to surveil Americans’ transactions and restrict politically unpopular activity.”
Unlike Bitcoin, a CBDC would operate on a state-controlled ledger. Critics, led by Emmer, warn that this could open the door to monitoring citizens’ spending habits and implementing programmable functionalities that could prevent individuals from using their money as they wish.
“Power-hungry bureaucrats will stop at nothing in their quest to gain control over the very people they’re supposed to be working for,” Emmer stated, highlighting concerns regarding China’s use of the digital yuan to track citizens’ expenses and the freezing of bank accounts of protesters in Canada in 2022.
Emmer initially introduced the bill in January 2022. The legislation had already been approved by the U.S. House of Representatives during the 118th Congress, and this vote represents another step forward toward its potential implementation.
