Cruz introduces bill to block Fed CBDC

US Senator Ted Cruz introduced legislation on March 26 to prohibit the Federal Reserve from issuing a central bank digital currency (CBDC), mirroring a bill reintroduced by Representative Tom Emmer earlier this month.

The “Anti-CBDC Surveillance State Act” would bar the Fed from offering CBDCs directly to individuals, citing privacy concerns and potential government overreach.

The Texas Republican’s bill aligns with Emmer’s House proposal, which seeks to prevent CBDCs from infringing on privacy protections afforded by physical currency.

Both measures exempt dollar-denominated digital currencies that are “open, permissionless, and private,” according to the text.

Cruz has long opposed CBDCs, introducing similar legislation in 2022 and 2023.

He warned in 2024 that a CBDC could enable “surveillance” by centralising financial transactions.

Emmer echoed these concerns, calling CBDC technology “inherently un-American” during a congressional hearing.

While the Federal Reserve has explored CBDC research since 2020, Chair Jerome Powell has stated the Fed will not issue one under his leadership.

Former President Donald Trump also vowed to block CBDCs, though other nations like the EU and Israel are advancing their own digital currency projects.

Critics argue CBDCs could modernise financial systems but risk centralising control over the money supply.

Supporters of Cruz’s bill emphasise preserving privacy, with the legislation explicitly excluding decentralised digital currencies that align with physical cash protections.

The Senate and House bills reflect growing bipartisan skepticism toward CBDCs, though their passage remains uncertain.

As Cruz’s proposal advances, it underscores debates about balancing innovation with privacy in digital finance.