US House Financial Services Committee Moves Forward with Legislation to Prevent Central Bank Digital Currency Issuance
The United States House Financial Services Committee is taking steps to prevent the creation of a central bank digital currency (CBDC). Chairman Patrick McHenry announced that the committee will mark up two bills related to the potential development of a digital dollar, which is a crucial step before legislation moves to the House floor.
One of the bills, known as the Digital Dollar Pilot Prevention Act or H.R. 3712, prohibits the Federal Reserve from conducting pilot programs to test CBDCs without approval from Congress. This legislation was originally introduced by Representative Alex Mooney in May.
The Federal Reserve recently stated that it has not made any decisions regarding the issuance of a CBDC, explaining that it would only proceed with a CBDC if authorized by law. However, the Federal Reserve of San Francisco has been hiring technical positions for a CBDC project, suggesting that the idea of a digital dollar is still being considered.
“A Federal reserve bank shall not offer a central bank digital currency, or any digital asset that is substantially similar under any other name or label, indirectly to an individual through a financial institution or other intermediary,” reads the second bill, which is an amendment to the Federal Reserve Act. This bill also prohibits Fed banks from offering certain products or services directly to individuals using CBDCs, as well as using CBDCs for monetary policy purposes.
The possibility of a digital dollar has sparked controversy in the United States. Both presidential candidates Robert F. Kennedy Jr. and Ron DeSantis have expressed their opposition to the creation of a CBDC, citing concerns about financial privacy. On the other hand, supporters of CBDCs argue that it would help maintain the global relevance of the US dollar and promote the adoption of cryptocurrencies.
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I've been involved in the cryptocurrency world since 2016 and trading since 2019. I started Moon and Lambo in 2021. I'm passionate about crypto and love to share my knowledge. I hate bankers and I hope that cryptocurrency will change the financial world for the better. View full profile...
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