Central bank digital currency has gained another top critic as the US Federal Reserve, under Jerome H. Powell’s chairmanship, considers potential CBDC designs.
In a July 23 tweet, Republican representative Warren Davidson condemned any potential move to launch a CBDC, noting that a digital currency flaws the ethos of money. Davidson urged Congress to ban and criminalize any effort to establish a central bank digital currency.
CBDC Is The Financial Equivalent Of Death Star, Says Congressman Davidson
Warren Davidson, the Ohio 8th Congressional District representative, stressed that money should not be programmable by a central authority. According to him, the Federal Reserve’s move to develop a CBDC is like “building the financial equivalent of the Death Star.”
He added that CBDCs reduce money into a tool for coercion and control in the hands of a central authority (the Federal Reserve). And “Congress must swiftly ban then criminalize any effort to design, build, develop, test, or establish a CBDC.”
It bears mentioning that Warren Davidson’s remarks came in response to the Federal Reserve Bank of San Francisco’s job advert for a senior crypto architect who would work on its CBDC project.
Responding to a Twitter user’s remark, Davidson also noted that money should remain a stable store of value and that sound money should facilitate permission-less peer-to-peer transactions.
While CBDCs continue to gain traction globally, the US Federal Reserve has been exploring appropriate designs for a potential digital US dollar. However, the central bank is yet to make decisions about whether to issue one or not.
Prominent US Political Figures Say CBDCs Violate Rights To Financial Privacy
The issue of establishing a digital dollar has stirred mixed reactions in the United States, particularly with the launch of the new instant payment system, the FedNow service.
Also, some have speculated that the possibility of issuing a digital US dollar would make a key debate point in the upcoming presidential election.
Meanwhile, Congressman Davidson isn’t the only prominent figure to voice disdain against the potential issuance of a fed-controlled digital US dollar.
On July 14, Florida Governor and US presidential candidate Ron DeSantis said he would ban any central bank digital currency if elected president. In May 2023, Governor DeSantis signed a bill prohibiting the use of CBDCs in Florida.
Another Republican, Tom Emmer, has repeatedly voiced his misgivings over a potential state-controlled digital dollar. Speaking at the Washington-based libertarian think tank, the Cato Institute, on March 9, Emmer said authorities could weaponize a programmable CBDC as a spying tool to occlude “politically unpopular activity.”
In February, Emmer introduced a CBDC Anti-Surveillance State Act, touted as an effort to protect Americans’ right to financial privacy. Emmer’s bill received support from Texas Senator Ted Cruz, who, in March, introduced his anti-CBDC bill, which also touted to preserve Americans’ financial privacy.