Warren Davidson, a Republican congressman from the United States, recently tweeted his vehement opposition to central bank digital currencies (CBDCs). It urges Congress to forbid their development and make any related activities illegal. Davidson criticized the Federal Reserve’s CBDC investigation, likening it to “building the financial equivalent of the Death Star.” He voiced concerns that CBDCs could be employed for coercion and control.
The Federal Reserve is building the financial equivalent of the Death Star.
Central Bank Digital Currency (CBDC) corrupts money into a tool for coercion & control.
— Warren Davidson 🇺🇸 (@WarrenDavidson) July 23, 2023
The San Francisco Federal Reserve Bank’s job posting for a “senior crypto architect” for a CBDC project prompted Davidson’s comments. The job advertisement raised concerns and led to his opposition to CBDCs. Davidson emphasized the stable value and permission-free peer-to-peer interactions in sound money, citing the importance of these attributes. He argued against money being programmable by a central authority.
The Federal Reserve is actively investigating the technology for a potential digital dollar, but it has not made any decisions about its issuance. The concept of a digital US dollar has ignited debates and is expected to be a significant topic in the 2018 presidential election.
Davidson Joins DeSantis and Emmer in Raising Concerns Over CBDCs
Florida Governor Ron DeSantis, a US presidential candidate, expressed concerns about Fed-controlled digital money. If elected president, he vowed to “nix any central bank digital currency.” In May, he signed a law prohibiting the use of CBDCs in his state.
Republican Representative Tom Emmer cautioned against state-controlled digital currency, warning of its potential use as a spying device to suppress political dissent. He raised concerns about the implications of a programmable CBDC. In February, Emmer introduced the CBDC Anti-Surveillance State Act to protect Americans’ financial privacy. The bill aimed to prevent unelected bureaucrats in Washington, DC from infringing on individuals’ financial data. Senator Ted Cruz of Texas, who put out his legislation to prevent the adoption of CBDCs, backed his bill.
Various political perspectives stress balancing innovation and financial privacy in the CBDC debate. Clear legislative standards are crucial for digital currency development. The outcome of these negotiations will significantly influence the future of the US banking system and the broader cryptocurrency market.