On Wednesday, US Congressman Tom Emmer introduced a new bill to Congress that prohibited “the Federal Reserve from issuing a central bank digital currency (CBDC) directly to individuals.”
Emmer explained that nations like China “develop CBDCs that fundamentally omit the benefits and protections of cash.” He suggested, instead, that the US digital currency policy must ensure financial privacy, consolidate the dollar’s dominance, and foster innovation. The lawmaker advised that the Fed could “mobilize itself into a retail bank, collect personally identifiable information on users, and track their transactions indefinitely” if it goes the direct CBCD way. The Republican rep. cautioned:
“Not only would this CBDC model centralize Americans’ financial information, leaving it vulnerable to attack, but it could also be used as a surveillance tool that Americans should never tolerate from their own government.”
Emmer further noted: “Requiring users to open up an account at the Fed to access a US CBDC would put the Fed on an insidious path akin to China’s digital authoritarianism.”
The Minnesota representative opined:
“It is important to note that the Fed does not, and should not, have the authority to offer retail bank accounts.” He also emphasized that “any CBDC implemented by the Fed must be open, permissionless, and private.”
US Congressman Tom Emmer Warns Against Stifling Outcomes of Issuing Direct CBDC
Rep. Tom Emmer concluded: “In order to maintain the dollar’s status as the world’s reserve currency in a digital age, it is important that the United States lead with a posture that prioritizes innovation and does not aim to compete with the private sector.”
Meanwhile, the Fed has yet to publish a report on its proposed CBDC progress, which it announced would be launched in 2021. That said, Fed Chair Jerome Powell recently assured that the report will get published “within weeks.”
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