US Senator Ted Cruz has introduced “legislation to prohibit the Federal Reserve from developing a direct-to-consumer central bank digital currency (CBDC). The legislator warned that “it could be used as a financial surveillance tool by the federal government.” Another senator emphasized: “The American people should be able to spend their money however they choose without the possibility of the government being able to track every transaction.”
Senator Ted Cruz’s CBDC Bill
US Senator Ted Cruz (R-TX) announced Tuesday that he has reintroduced “legislation to prohibit the Federal Reserve from developing a direct-to-consumer central bank digital currency that could be used as a financial surveillance tool by the federal government.” The bill, co-sponsored by Senators Braun (R-IN) and Senator Grassley (R-IA), was first introduced in March of last year.
The announcement highlights the importance of ensuring that US digital currency policy “protects financial privacy, maintains dollar dominance, and cultivates innovation.” Cruz warned:
CBDCs that do not adhere to these three basic principles could allow an entity like the Federal Reserve to become a retail bank, collect personally identifiable information about users, and track their transactions indefinitely.
The Texas senator noted that unlike decentralized cryptocurrencies such as bitcoin, CBDCs “centralize Americans’ financial information, leaving it vulnerable to attack.”
He warned: “The federal government has no authority to unilaterally establish a central bank currency,” adding:
We should empower entrepreneurs, enable innovation and increase individual freedom, not stifle it.
“Allowing the government to centralize Americans’ financial information and increase surveillance of Americans’ financial activity is simply a bad idea,” said Senator Braun.
Commenting on the bill he cosponsored, Senator Grassley opined:
The American people should be able to spend their money however they choose without the possibility of the government being able to trace every transaction.
Senator Cruz is a bitcoin investor who buys BTC weekly. Expressing strong optimism towards crypto, he explained that he is optimistic about BTC because it is decentralized and uncontrollable. In January of this year, he introduced a resolution encouraging Capitol gift shops to accept cryptocurrency.
Meanwhile, Congressman Tom Emmer also recently reintroduced his “CBDC Anti-Surveillance State Law” in the House of Representatives. This week, Florida Gov. Ron DeSantis proposed banning the use of a federally adopted CBDC as currency in his state. However, Federal Reserve Chairman Jerome Powell said earlier this month that the Fed is not at the stage of making any real decisions on a CBDC. “We have not decided that this is something that the country’s financial system wants or needs,” he clarified.
Do you agree with Senator Ted Cruz on the harm that a direct-to-consumer central bank digital currency could do to American consumers? Let us know in the comments section.
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