North Carolina Assembly Passes Bill Blocking Use of Federal Reserve's CBDC
Summary:
The North Carolina General Assembly has approved a bill prohibiting state agencies from using or accepting a central bank digital currency (CBDC) provided by the Federal Reserve. The bill also disallows participation in any CBDC tests run by the Federal Reserve. Louisiana signed a similar law lately. Now both bills are waiting for approval from their governors. The U.S. House approved a bill last month, barring the Federal Reserve from issuing a CBDC, which is now under Senate consideration.
The General Assembly of North Carolina has given legislative approval to a bill that prevents the state's government from utilizing or accepting a central bank digital currency (CBDC), provided by the Federal Reserve. House Bill 690, approved by the House in a 109-4 vote on June 26 and by the Senate in a 39-5 vote the previous day, is now slated for Governor Roy Cooper's approval. If the bill becomes law, it will immediately restrain all state-run institutions and judicial entities from receiving payments via CBDC, as well as prohibit them from participating in CBDC experimentation conducted by any Federal Reserve branch.
This legislative resolution coincides with a similar one in Louisiana, where Governor Jeff Landry has signed a law that eschews governmental acceptance or involvement with a CBDC. Louisiana's law further guarantees a right for individuals to secure their crypto assets privately. Given the widespread backing of North Carolina's bill, it could potentially override a veto from Governor Cooper, as it garners support from more than three-fifths of lawmakers in both legislative bodies.
The decision from Governor Cooper's office remains unaired, with no comments presently available in regards to his intentions for the bill. In a federal Senate Banking Committee hearing held in March, Federal Reserve Chair Jerome Powell asserted that the U.S. was far from endorsing or adopting any form of a CBDC.
Despite Powell's stance, last month the U.S. House approved a bill barring the Federal Reserve from releasing a CBDC. The bill is now under the Senate's consideration. A survey conducted by the Bank for International Settlements (BIS) on June 14 revealed that 94% of central banks participating in the poll are mulling over issuing a CBDC, with an unexpected surge in CBDC wholesale experiments and pilots reported by BIS.
According to BIS, in the next half-decade, it is more likely for a central bank to issue a wholesale CBDC than a retail CBDC, with the latter targeted at ordinary users. Nevertheless, BIS underscored that there are still several undecided features regarding CBDC.
Published At
6/27/2024 4:32:29 AM
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