A legislative proposal from Florida Governor Ron DeSantis proposes to ban the use of Central Bank Digital Currencies, also known as CBDCs, in Florida.
The legislation, announced by the possible Republic contender for President of the United States, “will protect Florida consumers and businesses from the reckless adoption of a ‘centralized digital dollar’ which will stifle innovation and promote government-sanctioned surveillance,” DeSantis said in a press release.
“The Biden administration’s efforts to inject a Centralized Bank Digital Currency is about surveillance and control,” said DeSantis. “Today’s announcement will protect Florida consumers and businesses from the reckless adoption of a ‘centralized digital dollar’ which will stifle innovation and promote government-sanctioned surveillance. Florida will not side with economic central planners; we will not adopt policies that threaten personal economic freedom and security.”
Biden’s Executive Order
De Santis is referring to a proposal earlier this year by President Joe Biden, who issued an Executive Order stipulating that Congress should begin to craft legislation for CBDCs and cryptocurrencies.
Part of Biden’s Executive Order encouraged the Financial Stability Oversight Council “to identify and mitigate economy-wide (i.e., systemic) financial risks posed by digital assets and to develop appropriate policy recommendations to address any regulatory gaps.”
Critics point to gaps in CBDC plan
However, critics of Biden’s plan — like Gov. De Santis — argue that it plays into a wider Conservative agenda within the Republican party that argues any federally sanctioned CBDC.
According to De Santis, a federally regulated CBDC “would diminish the role of community banks and credit unions in our financial system as CBDC currency would be a direct liability of the Federal government, rather than of a chartered financial institution, shrinking market lending power.”
However, there are others like U.S. lawmaker Tom Emmer, who argue that banking policies that look unfavorably upon crypto, while also touting the Fed’s own version of a settlement system, known as FedNow (set to launch in July), propose any anti-competitive market standard that privileges the government’s own financial onramps, over that of the private sector.
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