US Congress Includes 'Anti-CBDC Provisions' in National Defense Authorization Act

A new provision restricting the issuance of central bank digital currency (CBDC) has been added to the National Defense Authorization Act (NDAA), a must-pass bill in the US Congress. The NDAA is legislation that approves the Department of Defense budget annually and must go through both chambers of Congress.

According to Bloomberg on the 21st (local time), this year’s NDAA amendments include a provision titled the 'Anti-CBDC Surveillance State Act.' The content is the same as the bill previously introduced solely by House Republican Whip Tom Emmer. Last summer, the House voted on Emmer's bill and passed it with 219 in favor and 210 against. This bill essentially prohibits the Fed from directly issuing CBDC to individuals.

Fed Chair Powell has repeatedly emphasized, "A CBDC will not be issued without congressional approval." Republican lawmakers maintain their opposition, arguing that CBDCs could be used as a means of surveillance over financial transactions. Emmer defined CBDCs as "government-controlled programmable money" and pointed out that "if it replaces cash, it would grant the government the authority to monitor Americans' transactions and block politically unfavorable activities."

On the other hand, Democrats oppose the provision, saying it would "discourage CBDC research itself." They argue that stopping it at the research stage could limit future options for monetary policy.