WASHINGTON – Sen. Mike Lee (R-UT) reintroduced the No CBDC Act to prevent the Federal Reserve from reshaping the U.S. financial sector and having the ability to monitor consumer transactions through a Central Bank Digital Currency (CBDC). President Donald Trump recently banned federal agencies from creating a CBDC through an executive order; this legislation would enshrine the ban permanently in law. It is co-sponsored by Sens. Ted Cruz (R-TX) and Rick Scott (R-FL) in the Senate. Rep. Andy Ogles (R-TN) is introducing the House companion bill. 

“The United States doesn't need to create a Central Bank Digital Currency to know it is a bad idea,” said Sen. Lee. “We've seen this play out in China with the digital Yuan. In early trials, China canceled its citizens' money after a set period, forcing Chinese citizens to spend their savings at the compulsion of the government. My bill protects Americans from a similar intrusion by prohibiting the Federal Reserve or any federal government agency from minting or issuing a CBDC, whether through a direct-to-consumer or intermediated model.”

“CBDCs are nothing more than a tool for tyrants to intimidate, control, and surveil the activities of American citizens, and it is my duty as a patriot to stop them.” said Rep. Ogles. “I am honored to co-lead this effort with Senator Lee.”

BACKGROUND:

During the Biden Administration, the Federal Reserve (“the Fed”) began to develop a potential framework – known as Project Cedar – for a Central Bank Digital Currency (CBDC), a digital asset issued and controlled by the Fed. A CBDC would alter the ability of financial institutions to function as lenders, while giving the federal government knowledge of every purchase that uses a CBDC. 

Financial institutions would be significantly restricted in offering loans, instead being relegated to functioning merely as wallets. A CBDC,  in many ways, allows the Fed to replace the role of banks as financial intermediaries, thereby granting the government far more power over the economy, inflation, and investment decisions. In other words, free enterprise and financial privacy would be dealt a critical blow with the creation of a CBDC.

Lastly, the Federal Reserve would have knowledge of every transaction involving a CBDC; if it maintains the technology to create and operate a CBDC, Big Brother will know Americans’ every purchase. 

SUPPORT:

 “Americans demand financial protection and privacy after facing the threat of unelected federal bureaucrats creating an invasive, all-seeing central bank digital currency controlled by the government. With a new conservative trifecta government, now is the time for Congress to protect Americans’ individual liberties and prohibit the government from centralizing its control over the economy. Heritage Action commends Sen. Lee for introducing this necessary legislation to safeguard Americans’ rights and promote freedom from financial intimidation.”

-Ryan Walker, Heritage Action Executive Vice President

 “A Central Bank Digital Currency creates a fully traceable and controllable digital money that has dastardly implications for civil liberties and economic freedom. Rather than offering separation of money and state as found in Satoshi’s innovation of Bitcoin, CBDCs merge the power of state and money in a programmable way that would be easily abused and prove harmful to individual liberty and financial freedom.

Sen. Lee's No CBDC Act would enshrine in law a prohibition against the Federal Reserve taking the United States down this path. On behalf of consumers who cherish their economic liberties, freedom of choice, and access to innovative technology, we applaud the Senator's efforts with this bill, and hope many more legislators align on the issue to defend our rights to financial privacy”

-Yaël Ossowski, deputy director of the Consumer Choice Center

“Senator Lee is leading the way in this important fight to prevent the government from creating an entirely new tool of financial control and surveillance. A federally issued CBDC would be either entirely useless or, more likely, deeply dangerous. Thanks to Senator Lee’s leadership, Congress is stepping in to make clear that the executive branch has overstepped its authorities and must halt this deeply misguided debacle at once.”

-David Williams, president of the Taxpayers Protection Alliance. 

For a one-pager, click HERE.

For full bill text, click HERE.