The House Financial Services Committee approved a bill to prevent the Fed from creating US central bank digital currency (CBDC). The bill will now advance to the House of Representatives.
US Congressman Tom Emmer introduced the new bill to ban the Federal Reserve from creating a CBDC in the future. The bill bans any CBDC pilot programs before they’re proposed. In addition, it prohibits the Fed from introducing a retail digital currency that could be used for citizen surveillance. Emmer spoke strongly about the CBDC being an issue of “privacy, individual sovereignty, and free market competitiveness.”
The new potential bill requires any progress on a government-backed digital token to be empowered by Congress. The bill’s approval in the House is unpredictable, however, its future in the Senate is more doubtful, as its majority is run by Democrats, who may not push ahead with the Republican-introduced bill. The House committee’s counterpart is the Senate Banking Committee, which is led by Democrats. The panel’s top Democrat, Rep. Maxine Waters, has the following stance on the bill and crypto legislation:
“It will keep the United States behind other countries, including China, as a race forward to develop a global standard for central bank digital currencies.
She adds the bill would “stifle that research and prevent us from moving forward, even if it means that the dollar loses its status as the world’s reserve currency and even if it means that U.S. citizens lose out on faster, cheaper and simpler payments.”Rep. Maxine Waters (D-Calif.).
Most countries worldwide have looked into or already begun establishing their own CBDC. However, the US has been relatively divided on the idea, and the industry of crypto as a whole. Now, it’s up to the House to decide on this new bill to prohibit the Fed from creating a CBDC.