Hagerty, Cruz, Colleagues Introduce Legislation to ban Central Bank Digital Currencies

February 26, 2024

WASHINGTON—United States Senator Bill Hagerty (R-TN), a member of the Senate Banking Committee, today joined Senator Ted Cruz (R-TX), along with Senators Rick Scott (R-FL), Ted Budd (R-NC), and Mike Braun (R-IN), in introducing the Central Bank Digital Currency (CBDC) Anti-Surveillance State Act, legislation to halt efforts by the Biden Administration to issue a central bank digital currency.

“From Operation Chokepoint to recent reports of political and religious profiling by FinCEN, it is clear that government bureaucrats have been far too willing to exploit the financial system to advance political agendas and target Americans,” said Senator Hagerty. “This bill blocks the issuance of a central bank digital currency, preventing CBDC from being used as a tool to surveil and violate Americans’ privacy.”

“The Biden administration salivates at the thought of infringing on our freedom and intruding on the privacy of citizens to surveil their personal spending habits, which is why Congress must clarify that the Federal Reserve has no authority to implement a CBDC,” said Senator Cruz. “I’m proud to lead the fight in the Senate to restrict the Federal Reserve’s exploration of and attempt to introduce a CBDC to the American economy.”

A CBDC is government-controlled programmable money that, if not designed to emulate cash, could give the federal government not only significant transaction-level data down to the individual user, but also the ability to program the CBDC to choke out politically unpopular activity.

The CBDC Anti-Surveillance State Act would prohibit the Federal Reserve from issuing a CBDC directly to anyone, ensuring the Federal Reserve can’t mobilize itself into a retail bank. It would also bar the Federal Reserve from issuing a CBDC indirectly to individuals through financial institutions or other third parties, as well as prevent the Federal Reserve from using a CBDC as a tool to implement monetary policy and control the economy. Finally, the bill would require authorizing legislation from Congress for the issuance of any CBDC.

Full text of the CBDC Anti-Surveillance State Act can be found here.