Senator Ted Cruz Proposes Legislation to Prevent Federal Reserve from Creating Central Bank Digital Currency
Introduction: Senator Ted Cruz (R-Texas) recently presented a bill to prohibit the Federal Reserve System from developing a direct-to-consumer central bank digital currency (CBDC), effectively creating a dollar-based cryptocurrency. The legislation comes as a response to ongoing research into the possibility of a US CBDC initiated by President Joe Biden’s executive order in March 2022.
- Empowering Entrepreneurs and Fostering Innovation
- a. Preventing government centralization and control of cryptocurrency
- b. Enhancing individual freedom and promoting entrepreneurship
Senator Cruz argues that the federal government lacks the authority to independently establish a central bank currency. He believes the bill will safeguard cryptocurrency from government centralization, allowing it to thrive within the United States. Cruz highlights the importance of empowering entrepreneurs, fostering innovation, and enhancing individual freedom rather than stifling it.
- Concerns Over Centralization and Surveillance
- a. Increased vulnerability to cyber attacks
- b. Potential surveillance of Americans’ private transactions
Opponents of central bank digital currencies express concerns that, unlike decentralized cryptocurrencies like Bitcoin, government-created digital currencies are centralized and more susceptible to cyber attacks. Moreover, they could be used as a surveillance tool to monitor Americans’ private transactions. Senators Mike Braun (R-Ind.) and Chuck Grassley (R-Iowa) have joined Cruz in cosponsoring the bill.
Braun and Grassley support the legislation, asserting that it will prevent the government from centralizing Americans’ financial information and increasing surveillance of their financial activities. They argue that the federal government should not have more control over individuals’ money, and that the legislation would promote entrepreneurship and protect privacy rights.
This week DeSantis called a similar ban in Florida. More about this in this page : Florida Governor Moves to Ban CBDC(Central Bank Digital Currency) in the State
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Image Source : REUTERS/Evelyn
