US Senator Proposes Banning CBDCs for Fear of Surveillance Play, While Crypto Execs Frustrated With White House Report

1. Senator Cruz proposes bill to ban CBDC for direct consumer use due to concerns of financial surveillance.
2. Crypto executives express frustration over White House economic report’s questioning of digital asset value.
3. Economic report criticizes cryptocurrencies for failing to deliver promised benefits and lacking fundamental value.

Senator Ted Cruz recently proposed a bill to prohibit the United States Federal Reserve from creating a central bank digital currency (CBDC) for direct consumer use.

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Cruz expressed concerns on March 21 that a retail CBDC could be employed as a financial surveillance instrument by the federal government. He emphasized the importance of digital currency policies that safeguard financial privacy, maintain the dollar’s dominance, and promote innovation.

Source: Newsroom Press Release

In a separate development, crypto executives have expressed frustration over the recent White House economic report, which devotes an entire chapter to questioning the value of digital assets. This marks the first time the annual Economic Report of the President has included a section on digital assets since its inception in 1950.

The 35-page report questions the “Perceived Appeal of Crypto Assets” and includes a brief section on the FedNow payment system and central bank digital currencies. It contends that crypto assets fail to deliver on their promised benefits, such as enhancing payment systems, financial inclusion, and value transfer mechanisms. The report asserts that cryptocurrencies’ innovations primarily center on creating artificial scarcity to bolster prices, with many lacking fundamental value.

Furthermore, the report claims that cryptocurrencies do not perform the functions of sovereign money like the U.S. dollar, as their prices fluctuate excessively, rendering them unstable stores of value and unsuitable as units of account or mediums of exchange. The report also criticizes stablecoins, arguing that they pose run risks and are therefore too dangerous to serve as “fast payment” instruments.

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• Crypto Market Bleeds as President Biden Proposes Increase Tax Rate