A Bipartisan Rejection of Growth of Digital Dollar
Senator Ted Cruz introduced the “Anti-CBDC Surveillance State Act” on March 26, a bill to ban the Federal Reserve from issuing a central bank digital currency (CBDC). The Senate bill is the companion to Representative Tom Emmer’s bill, which was reintroduced in the House on March 6.
Both lawmakers are convinced that a CBDC issued by the federal government would allow unnecessary monitoring and government control of individuals’ transactions. The bill even prohibits the Fed from providing products or services directly to individuals—a huge provision for establishing a CBDC.
Companion Legislation Advances
Cruz’s bill is a companion to Emmer’s, i.e., they are nearly identical and introduced in different chambers to advance a consolidated legislative push.
The bills also clarify that the restriction does not apply to any open-source, permissionless, private digital currency that shares the privacy features of physical cash.
Long-Standing Opposition to CBDCs
Senator Cruz has been a prominent critic of CBDCs since 2022, when he first introduced bills to stop them. He repeated the suggestions in 2023 and again in 2024, targeting Biden administration efforts to proceed with a digital dollar.
During a recent congressional hearing, Emmer argued that CBDCs are “inherently un-American,” warning that allowing unelected bureaucrats to issue such a currency would fundamentally alter American life.
Privacy Fears Dominate the Debate
Critics have argued that CBDCs could enable governments to have unparalleled oversight of people’s financial data and purchasing habits.
Despite public resistance in the US, some global counterparts continue to explore CBDCs. The EU is pushing hard on a digital Euro, Israel proposed a draft for a digital shekel, and Iran is proceeding towards a CBDC rollout.
Meanwhile, US leaders are still at odds. Former President Donald Trump committed to fighting CBDCs, while Fed Chair Jerome Powell indicated that the Fed would not go after one on his watch.
The Future of Digital Currency in America
While central bank digital currencies would make financial systems more modern, they have enormous centralization and privacy issues. As a result of the opposition by influential stakeholders like Cruz, Emmer, Trump, and Powell, the future to a US-issued CBDC is highly uncertain.
