A significant development unfolded as the United States House Financial Services Committee took steps towards legislation aimed at curbing the launch of a central bank digital currency (CBDC). These proposed bills, slated for markup on September 20, have sparked intense debate and controversy surrounding the future of digital currencies in the United States.
The committee’s chairman, Patrick McHenry, announced that two bills concerning the potential implementation of a digital dollar will undergo markups on September 20. These markups serve as a crucial step where lawmakers deliberate on bill specifics before it progresses to the House floor.
The Digital Dollar Pilot Prevention Act, also known as H.R. 3712, is a bill introduced by Representative Alex Mooney in May. Its main objective is to prohibit the Federal Reserve from initiating pilot programs to test Central Bank Digital Currencies without obtaining approval from Congress.
The Federal Reserve recently announced that it hasn’t decided on issuing a Central Bank Digital Currency. They emphasized the need for an authorizing law. However, it’s worth noting that the Federal Reserve of San Francisco has actively been recruiting technical positions for a CBDC project. It suggests their ongoing interest in exploring this avenue.
The second piece of legislation aims to amend the Federal Reserve Act to prohibit Fed banks from directly providing specific products or services to individuals. Furthermore, it limits the use of CBDCs for monetary policy and other purposes.
Debate and Developments Surrounding the U.S. Digital Dollar and Global CBDC Trends
The bill prohibits Federal Reserve banks from indirectly offering digital currencies resembling a central bank or any similar digital assets to individuals through financial institutions or intermediaries.
The concept of a digital dollar has ignited a contentious debate within the United States. However, Presidential candidates Robert F. Kennedy Jr. and Ron DeSantis have expressed their concerns about financial privacy and firmly opposed the establishment of a Central Bank Digital Currency.
CBDC proponents argue that implementing a Central Bank Digital Currency could not only uphold the global influence of the U.S. dollar but also foster wider acceptance and adoption of cryptocurrencies.
Related Reading| Cardano Advantages Attract NFT Collectors From Ethereum
More than 100 countries are involved in different stages of central bank digital currency projects. However, China has already conducted successful pilot programs for its digital yuan across multiple cities.
“The author’s views are for reference only and shall not constitute any investment advice. Please ensure you fully understand and assess the products and associated risks before purchasing.”
Comments (No)