US Senator Ted Cruz Tries Again With New Bill to Block CBDC

U.S. Senator Ted Cruz is making a second attempt to block the use of central bank digital currencies (CBDCs) in the United States. Cruz announced he has filed a new bill – the Digital Commodity Exchange Act of 2021 – to protect the financial privacy of American citizens. The bill, sponsored by Cruz, would force any organization or person wanting to issue a digital currency to register as a “financial commodity” exchange with the Commodity Futures Trading Commission (CFTC). Those who fail to register could face criminal sanctions. Cruz said it is “more important than ever” to ensure the financial privacy of American citizens is preserved. He noted that a CBDC could have “know-your-customer” requirements, where financial institutions would need to identify every customer they transact with. Cruz also said the possibility of a “digital dollar” could be used to track law-abiding citizens’ purchases. The CFTC already has the authority to regulate exchanges of virtual currencies, but the proposed legislation would extend this authority to digital currencies. This would give the CFTC the power to impose penalties and restrict the use of CBDCs, as well as other digital commodities, that do not meet their standards. It’s unclear if the new bill will gain traction in Congress, but it’s likely to be a topic of debate between action agencies, legislators, and the private sector in the near future. If the bill passes, it could have major implications for the decentralized finance, or DeFi, sector, which has embraced CBDCs as a mainstream alternative to traditional banking. It could also cause a ripple of changes in other industries as well, as many companies have begun to explore using CBDCs in their operations. Category: Direct-to-Consumer CBDC