- The CBDC Anti-Surveillance State Act passed a House committee vote with 27-22 margin, moving the Republican effort to block a U.S. digital dollar forward.
- Rep. Tom Emmer warns a CBDC could enable government financial surveillance and control, unlike decentralized cryptocurrencies like Bitcoin.
- The bill would prevent the Federal Reserve from issuing a digital dollar directly or through intermediaries, and block its use as a monetary policy tool.
The CBDC Anti-Surveillance State Act, a Republican-led initiative to prevent the creation of a U.S. central bank digital currency, advanced on Wednesday after passing the House Financial Services Committee with a 27-22 vote. The legislation, sponsored by Rep. Tom Emmer (R-MN), aims to block the Federal Reserve from issuing a digital dollar due to concerns about financial surveillance and the central bank potentially becoming a retail banking entity.
The bill specifically prohibits the Fed from directly issuing a CBDC and bars it from deploying such currency through intermediaries. Additionally, it explicitly prevents the central bank from using a digital currency as a tool for implementing monetary policy, as reported by the House Financial Services Committee.
Privacy Concerns Drive Opposition
During the markup session, Emmer voiced strong support for the bill, arguing that the government should never create tools for financial surveillance. “Unlike decentralized cryptocurrencies, such as Bitcoin, a CBDC is a digital form of sovereign currency that is issued, monitored, and managed by a central bank,” he said. He further warned that without proper privacy protections like those of physical cash, a CBDC “could give the federal government unilateral authority to surveil Americans’ transactions and restrict politically unpopular activity.”
Unlike Bitcoin and other decentralized cryptocurrencies, a CBDC operates on a government-controlled ledger. Critics, with Emmer at the forefront, caution that this design could enable authorities to monitor citizens’ spending habits and potentially implement programmable features that restrict how individuals spend their money.
Growing Opposition to Digital Dollar
The strong resistance to a potential U.S. CBDC indicates increasing momentum among privacy advocates and crypto-friendly lawmakers who view a digital dollar as potentially threatening financial freedom. Emmer highlighted international examples to support his position, referencing concerns about China using its digital yuan to track citizens and Canada‘s freezing of protestor bank accounts in 2022.
“Power-hungry bureaucrats will stop at nothing in their quest to gain control over the very people they’re supposed to be working for,” Emmer stated, emphasizing the risks he perceives with government-controlled digital currencies.
Emmer first introduced legislation to ban CBDCs in January 2022. The current bill has already passed the U.S. House of Representatives during the 118th Congress, showing sustained support for limiting the development of a federal digital currency.
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