The CBDC Anti-Surveillance State Act passed the U.S. House of Representatives on May 23, following a largely partisan vote of 216-192. The bill, which seeks to amend the Federal Reserve Act of 1913, aims to prohibit Federal Reserve banks from offering certain products or services directly to individuals and using central bank digital currency (CBDC) for monetary policy.
Republican supporters of the bill voiced concerns about the potential abuse of a CBDC, while Democrats focused on the importance of innovation, the international competitiveness of the dollar, and criticized the bill’s drafting. Financial Services Committee Subcommittee on Digital Assets Chairman French Hill emphasized the risks of governmental overreach, stating, “We live in a world where the government can abuse the tools it has.”
Representative Mike Flood challenged the audience to consider the dangers of political control over a CBDC, while Warren Davidson likened Project Hamilton to China’s digital yuan, calling it a “creepy surveillance tool.” Davidson and others stressed the need for legal constraints on the Fed’s CBDC research and development.
Democrats, including Financial Services Committee ranking member Maxine Waters, argued the bill could undermine the global primacy of the U.S. dollar and disrupt existing payment systems. Waters highlighted privacy-preserving technologies like zero-knowledge proofs and warned of the potential economic risks posed by dollar-pegged stablecoins compared to a CBDC.
The bill, introduced by Representative Tom Emmer in February 2023, now faces a Senate vote. The debate underscored deep partisan divides over the role and risks of a CBDC in the U.S. financial system.
