Majority Whip Tom Emmer's (MN-6) CBDC Anti-Surveillance State Act has advanced out of the House Financial Services Committee. The legislation would bar the Federal Reserve from issuing a central bank digital currency (CBDC) to individuals either directly or through intermediaries and would prohibit the Fed from using CBDC in monetary policy.
The Financial Services Committee advanced the bill to the House floor on Sept. 20, according to a press release from Emmer's office. Emmer said the bill is necessary to prevent the weaponization of the financial system against Americans. He cited the Chinese government's use of its CBDC to "track the spending habits of its citizens" and use that data to support its social credit system, through which Chinese citizens can be punished or rewarded based on their behavior. "If China embraces it, you know it’s something worth standing against in this country," Emmer said.
Emmer said the "future global digital economy" should emulate cash by being open and permissionless, otherwise digital currency could become a tool for surveillance, according to the press release. He noted that the bill is supported by groups including the Blockchain Foundation, the Independent Community Bankers Association, and the American Bankers Association.
China has been developing its CBDC, the digital yuan or e-CNY, since 2014, according to a report from the Foreign Policy Research Institute. The report said that although the People's Bank of China claims that the digital yuan allows "anonymity for small amounts" and guarantees "reasonable personal information protection needs of the public," China's cybersecurity laws enable the government to attain data from any Chinese entity. "In reality, anonymity is actually conditional and ambiguous," the report said.
