The CBDC discussion in the US finally starts to take shape.
CBDC, or Central Bank Digital Currency, is a project dear to many Central Banks all over the world, as it would offer them a direct access to every citizen. A CBDC could be used to distribute “helicopter money” or other social incentives directly to people and ensure faster national and international transfers.
However, a CBDC can also be a dangerous tool of state surveillance: just imagine a ledger controlled by a single authority that contains the financial activity of all the citizens. Hello, Big Brother 👁️ 👁️
In the US the CBDC issue was until recently presented mostly by its proponents – the Fed, the government… all speaking highly about the possibilities a dollar CBDC could offer in terms of speed (“1.7 million transactions per second”) and security (“no associated credit or liquidity risk”).
President Biden’s latest executive order stressed the importance of the CBDC research and instructed the government and the Fed to develop a plan to support it.
Since recently, however, alternative voices start to rise.
In January Congressman Tom Emmer (MN-06) introduced a Bill prohibiting the Fed from issuing a CBDC directly to individuals. It stressed that a direct-to-consumer CBDC could be used as a financial surveillance tool by the federal government, similar to what is currently happening in China (which introduced the digital yuan last year).
Yesterday Senator Ted Cruz (R-Texas) offered the Bill a Senate companion, which will allow it to be considered in both chambers of Congress at the same time, speeding up the decision.
Earlier this month nine Republican Senators presented a legislation aiming at regulating the digital yuan, which can “empower Russia to evade global sanctions on systems such as SWIFT and enable the CCP to further surveil and threaten their citizens”.
Now it’s the turn of the “digital dollar” project, and it is good to see that some American politicians oppose the idea of the American government having one more surveillance tool of its own.