CBDC: American freedom under threat?

A wind of revolt is blowing in the US Congress over the prospect of the establishment of a central bank digital currency (CBDC) by the Federal Reserve. Lawmakers are citing an imminent threat to citizens’ freedoms, brandishing the bogeyman of the authoritarian use of CBDCs in some countries. The act is on: the bill to end the Federal Reserve’s testing of the digital dollar has been introduced.

An act of resistance against the digital dollar

Often seen as a threat to cryptocurrencies, CBDCs are now causing apprehension even within the Republican Party. Indeed, the American political scene is mobilizing in defense of civil liberties.

MP Alex Mooney (R-WV) filed the Digital Dollar Pilot Prevention Act (HR 3712). This is a bill explicitly targeting the Federal Reserve’s attempts to issue a CBDC. This law, supported by 14 Republicans in the House of Representatives, is intended to be a barrier against what they consider to be a potential tool of repression.

Indeed, the CBDC opens the door to potentially disturbing implications for individual freedoms. Theoretically, if a CBDC is put in place, the state could have the ability to freezing bank accounts and seizing funds. Although this possibility is already present with traditional banks, the effectiveness of such actions would be greatly improved with the implementation of a CBDC.

Furthermore, the CBDC could facilitate privacy breaches and give the state greater control over individuals’ spending.

With today’s technological evolution and the proliferation of the Internet of Things, our privacy rights are already compromised. The introduction of the CBDC would only accelerate this trend. The surveillance boat has already set sail, and the CBDC may well be the wind that fills its sails.

Bitcoin, a privacy model against CBDCs

The specter of government surveillance hovering over CBDCs is at the heart of the concerns. In contrast, bitcoin promotes a decentralized design where transactions are pseudonymous. This makes mass surveillance more complex.

The issue of a CBDC thus goes beyond civil liberties to encompass the protection of privacy. Although Federal Reserve Chairman Jerome Powell says the organization is only in a preliminary phase of experimentation, this prospect is already arousing strong opposition, including at the state level.

The outcome of this legislative battle will determine the future of the digital dollar in the United States. Will the country go down the controversial CBDC route, at the risk of seeing the freedoms of its citizens potentially hampered? Or, on the contrary, will Congress succeed in putting a stop to this major technological evolution? Only time will tell, but one thing is certain: the currency of tomorrow leaves no one indifferent.