The bill opposing surveillance of central bank digital currency (CBDC) progressed beyond the house committee. The bill sponsored by Majority Whip Tom Emmer awaits the House vote following Wednesday’s passing by the House Finance Services Committee (HFSC).
The approval of the CBDC Anti-Surveillance State Act by HFSC marked the start of readying the legislation for its House floor vote. The bill constitutes the proposal of Congressman Tom Emmer, who in the past has maintained vocal support for cryptocurrencies.
The legislation aims to prohibit the Federal Reserve from CBDC issuance to Americans. The bill considers CBDCs as the financial surveillance tools deployed by central banks. The bill harbors the argument advanced by various presidential candidates led by Florida Governor Ron DeSantis. Also, Democratic hopeful Robet F. Kennedy Jr. has repeatedly opposed CBDCs, alleging they are surveillance tools.
CBDC Pursuit Considerd unAmerican Practice
Emmer emphasized that pursuing CBDC is unAmerican during his prepared remarks for Wednesday, September 20. The congressman admitted it is alarming by citing other instances when governments weaponize the financial system against the citizens.
Emmer warned that allowing the Federal Reserve to issue CBDC to the US would mirror the move by the Chinese Communist Party to track purchases executed by citizens. Also, it could present an opportunity to replicate the move by Canadian Prime Minister Justin Trudeau, who froze bank accounts run by protestors in 2022.
The bill prohibits the utilization of such tools as monetary policy. This provision is derived from the suggestions by the European Central Bank that CBDCs harbor the potential to weaken and strengthen monetary policy. It admitted that the CBDC projects have complex and varying outcomes in the economy.
The Emmer bill does not expand the scope beyond CBDC. The proposed bill does not affect private market stablecoins, including Tether’s USDT and Circle’s USD Coin (USDC).
The Wednesday session mirrored past crypto-related issues with its support reviving the partisan lines. The bill attracted 60 Republican co-sponsors, with Democrat committee members opposed to the legislation to advance.
CBDC Anti-Surveillance Bill Opposed by Democrats
Representative Brad Sherman gave a speech to oppose the CBDC anti-surveillance proposal. The democrat lawmaker labeled the bill’s sponsors as hypocritical since they promoted the privately issued stablecoins over central bank-issued ones. Instead, he restated his willingness to support the bill, provided it ended cryptocurrencies.
Maxine Waters, who is a Democrat representative, faulted the Republicans for adopting the deep anti-innovation stance. She warned that approving the CBDC Anti-surveillance risks plunging the US trailing rivals adopting the technology.
Water decried that failure to implement CBDC in the US could erode the dollar’s status as the reserve currency. Besides, the US citizens would bear the loss of missing out on faster, simpler payment channels.
Democrats Hypocritical for Opposing Stablecoins Bill
The HFSC chair, Partick McHenry, termed Representative Waters and colleagues as influenced by the White House stance. He cited how Democrats blocked stablecoin legislation despite the months spent during the bill’s negotiation.
McHenry considers that the Clarity for Payment Stablecoins Act (2023) offered an elaborate regulatory framework for privately issued stablecoins. He decries that the Democrats instead viewed the proposals as creating a favorable template for the crypto industry.