- Republican Senator Ted Cruz is actively looking to block the creation of a Digital Dollar.
- Cruz claims such a U.S. CBDC would infringe upon the financial freedoms of citizens as their spending could be tracked.
- Cruz has the support of other senators for his bill, while others are implementing their own bills to block CBDCs.
Central Bank Digital Currencies (CBDC) have split opinions across several sectors. Crypto natives either love or hate the idea of government-controlled blockchain tokens, while government officials are equally polarized.
Texan Republican Ted Cruz is the latest Senator to try and block the creation of a U.S. Digital Dollar. On Tuesday, March 21, Cruz said he would introduce a bill to prevent the Federal Reserve from developing a retail CBDC.
Cruz’s reasoning for blocking a U.S. CBDC is to protect “financial privacy, maintain the dollar’s dominance and cultivate innovation.” Cruz believes a Digital Dollar “could be used as a financial surveillance tool by the federal government.”
Cruz’s bill already has the support of Republican Senators Mike Braun of Indiana and Chuck Grassley of Iowa, who echo the Texas Senetor’s concerns about financial surveillance in the statement made by Cruz ahead of his bill.
A Red Wave of Support
Support for blocking CBDCs does not seem to be an issue on the Republican side of the U.S. political sphere. On Monday, March 20, Florida Governor Ron DeSantis also introduced legislation banning CBDCs from the Sunshine State.
DeSantis also portrayed his blockade against the financial tool as a measure to safeguard Floridians’ financial privacy.
“What a central bank digital currency is all about is surveilling Americans and controlling Americans,” DeSantis said. “You're opening up a major can of worms, and you're handing a central bank huge, huge amounts of power, and they will use that power.”
U.S. Representative Tom Emmer is working to prohibit the Federal Reserve from implementing monetary policy based on a CBDC. Emmer’s policy is in reaction to the current presidential administration working to roll out a CBDC.
Daleep Singh — a former adviser for international economics in the Biden administration — spoke about how a Digital Dollar would have enough power to “crowd out the ecosystem of crypto.”
Biden himself signed an executive order in March last year, requiring the government to assess the risks and benefits of creating a CBDC.
On the Flipside
- Senator Cruz is not only anti-CBDCs but pro-Bitcoin. In January, he introduced a measure in the Senate calling for crypto payments within areas of the Capitol to be accepted. Furthermore, Cruz disclosed that in February of 2022, he brought up to $50,000 worth of Bitcoin.
Why You Should Care
The battleground of U.S. politics is spilling into the decentralized cryptocurrency field. Republicans are latching onto the financial freedom and innovation from Bitcoin and the like. At the same time, the Democrats are more focused on government control and policing of the technology.
Read more about the ongoing political battle around CDBCs:
Digital Dollar CBDC Could Leave Crypto Lagging, Says Ex-Biden Advisor
Read more about Coinbase’s petition to the SEC over its crypto staking services:
Coinbase Petitions SEC to Exclude Crypto Staking from Securities Law