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24/05/24
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U.S. House of Reps Passed CBDC Anti-Surveillance State Act
On May 23, the U.S. House of Representatives passed a bill known as the CBDC Anti-Surveillance State Act, aimed at amending the Federal Reserve Act of 1913 to disallow Federal Reserve banks “from offering certain products or services directly to an individual, to prohibit the use of central bank digital currency for monetary policy, and for other purposes.”
Republicans backed the bill, but attendance for the debate was sparse. The senate needs to vote and pass the bill before it can be approved. According to the Republicans who support the bill, a central bank digital currency (CBDC) might be abused, while Democrats are concerned about innovation, the global competitiveness of the USD as well as the poor drafting of the bill.
Congressman French Hill believes governments around the world can abuse the tools they possess. Congressman Mike Flood urged the audience to “imagine the politician you despise the most” having control over a CBDC.
Congressman Warren Davidson talked about the New York Fed’s Project Hamilton, noting that it is “the same creepy surveillance tool” as China’s digital yuan. Likewise, according to Davidson, the pilot project “could be developed to something further.” The Federal Reserve’s failure to provide response to dialogue means the law must take over, he said.
Congressman Alexander Mooney, who authored an amendment to the bill that restricted CBDC research, said CBDC should not be “available at a moment’s notice.” The lawmakers referred to the digital yuan frequently, as well as the Canadian government’s blockage of bank accounts when trucker drivers were demonstrating against COVID-19 vaccination.
They likewise disputed the exact consequences of the bill, with Congressman Brad Sherman calling it a “word salad” that favored “crypto bros.” Congressman Maxine Waters mentioned the possibility of construing the bill to prohibit a wholesale CBDC, arguing that the bill would “risk undermining the primacy of the U.S. dollar” worldwide.
“[The bill] blocks the American economy as it operates today and has for decades,” said Waters. Further, Waters suggested the use of zero-knowledge proof tech to facilitate user privacy, noting that a CBDC cannot lose value in a run relative to USD-pegged stablecoins.
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