U.S. Financial Committee Takes Further Steps Against Digital Dollar CBDC

The U.S. House Financial Services Committee has recently accelerated its efforts to curtail the potential introduction of a central bank digital currency (CBDC).

Legislative Actions on Digital Dollar

Late last week, Chairman Patrick McHenry announced that the committee plans to discuss two significant bills regarding the possible launch of a digital dollar. These discussions, known as markups, are pivotal phases before a bill is presented to the House.

One primary focus is the “Digital Dollar Pilot Prevention Act” or H.R. 3712. The proposal was authored by Representative Alex Mooney earlier this year. The legislation demands that the Federal Reserve acquire Congressional approval before exploring CBDC pilot programs.

While the Federal Reserve has remained ambiguous about endorsing a CBDC, their recent recruitment for technical roles linked to a CBDC project implies continued interest.

Amendment to the Federal Reserve Act

The second legislation under scrutiny is a suggested change to the Federal Reserve Act. This amendment discourages Fed banks from extending certain services directly to individuals. Furthermore, it addresses the usage of CBDCs, particularly for monetary policy and related objectives. The bill states, “A Federal reserve bank shall not offer a central bank digital currency, or any digital asset resembling it, indirectly to an individual via a financial entity or intermediary.”

The concept of a digital dollar has ignited a fierce debate nationwide. Leading figures like presidential hopefuls Robert F. Kennedy Jr. and Ron DeSantis have expressed reservations about financial privacy concerns. However, there’s a faction advocating for CBDCs, believing it could reinforce the dollar’s global dominance and further the acceptance of cryptocurrencies.

As the global finance landscape continually evolves, the U.S.’ stance on the digital dollar remains a topic of significant interest and contention. With these upcoming legislative discussions, a clearer picture might soon emerge regarding the future of CBDCs in the nation.

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