- Congressman Alex Mooney introduces legislation to halt Federal Reserve’s CBDC testing.
- The bill cites potential threats to the liberties of American citizens.
- The Federal Reserve CBDC remains in the preliminary stages.
Central Bank Digital Currency (CBDC) has been controversial since its inception. Critics cite the Orwellian powers it grants to the governments, from tracking all transactions to cutting people out of the financial system. Now, a growing number of US Republican lawmakers are taking concrete steps against its implementation.
On Tuesday, May 30, Congressman Alex Mooney proposed a bill to block the Federal Reserve from testing a CBDC pilot. The bill raises concerns about potential infringements on the liberties of Americans.
The Digital Dollar Pilot Prevention Act
The legislation in question, known as the Digital Dollar Pilot Prevention Act, seeks to prevent the Federal Reserve from launching, conducting, or approving any program related to testing a potential CBDC. The bill is co-sponsored by fourteen other House Republicans.
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Specifically, bill supporters fear digital currency could pave the way for governmental overreach and surveillance. As a counterpoint, proponents argue that a CBDC could streamline financial transactions and provide access to financial services for the underbanked.
The Federal Reserve’s Stance on CBDCs
Despite the pushback from lawmakers, Federal Reserve Chairman Jerome Powell revealed that decisions around the development of a CBDC are not definitive yet. Instead, the central bank is engaged in early-stage experimentation and exploration.
Powell’s comments suggest that the Federal Reserve is taking a measured approach and is considering the broader implications of issuing a CBDC.
On the Flipside
- Other countries have moved forward with their CBDC initiatives in the international arena. China, for instance, has already rolled out its digital yuan.
- CBDCs could offer various benefits, such as improved financial inclusion and more efficient payment systems.
Why This Matters
The legislation, if successful, will have far-reaching effects on the future of money and financial systems. The United States‘ path will likely significantly shape the global discourse on digital currencies.
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Read more about CBCDs:
Central Bank Digital Currency (CBDC): What to Know
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