Central Bank Digital Currencies (CBDCs) are not welcomed in the State of North Carolina. This is the message of the State’s House of Representatives. Legislation was passed that aims to stop the use of CBDC as a payment to the State and it also prohibits the State to participate in any Federal testing. The bill is known as House Bill 690 and was passed on May 3, 2023. It is currently headed to the Senate for approval.
House Bill 690 defines a CBDC as “a digital currency, a digital medium of exchange, or a digital monetary unit of account issued by the United States Federal Reserve System or a federal agency.” The bill prohibits any state agency or the General Court of Justice from accepting payments using CBDCs or participating in any test of a CBDC by any Federal Reserve branch. The bill also limits the Federal Reserve from using North Carolina as a potential testing ground for its own CBDC pilot.
What is CBDC?
CBDCs are digital versions of a nation’s currency issued by its central bank. They are different from cryptocurrencies, which are decentralized and transparent. CBDCs are centralized and backed by the full faith and credit of the issuing government. Many countries are exploring or developing CBDCs as a way to enhance financial inclusion, reduce transaction costs, improve monetary and fiscal policy, and combat money laundering and illicit activities.
However, some lawmakers in North Carolina and other states are opposed to CBDCs, citing concerns over privacy, security, sovereignty, and economic stability. They argue that CBDCs could enable excessive government surveillance and control over citizens’ financial transactions and behavior.
North Carolina is Not Alone
The bill is part of a broader legislative push against CBDCs at both the state and federal levels. In March, Florida Governor Ron DeSantis called for a CBDC ban in the state, claiming that CBDCs were all about surveillance and behavior control. At the federal level, Representative Tom Emmer and Senator Ted Cruz have both introduced separate bills aimed at restricting the Fed’s authority over CBDCs or proposing an outright ban.
Presidential Candidate Robert Kennedy Jr., a crypto advocate, is warning the public that “CBDCs are the ultimate mechanism for social surveillance and control. He is also suggesting that cryptocurrencies like Bitcoin are a form of escape from financial collapse.
CBDC is Not Crypto
Crypto and CBDC are both digital in nature. But the similarity stops there. Crypto was created to be free from a central authority, while CBDC can give more power to the government. This digital fiat is not called programmable money for nothing. Because in a dystopian future, it can be used to control how much a person can save, send or spend.
A lot of politicians, including those in North Carolina, are now seeing the potential risks of CBDCs. And they are rightfully protecting their constituents from total financial control. They are trying to fight for a future where financial freedom still exists.
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