April 19, 2024
U.S. Senators Challenge CBDC Status as 'Money' with Multiple Bills
Policy & Regulation

U.S. Senators Challenge CBDC Status as ‘Money’ with Multiple Bills

Several U.S. states are taking a stance against recognizing central bank digital currencies (CBDCs) as legal tender, with bills introduced in Utah, South Carolina, South Dakota, and Tennessee aiming to exclude CBDCs from the definition of money. These legislative moves could pose significant hurdles to the adoption of CBDCs in the United States.

In Tennessee, State Senator Frank Niceley presented a bill to the Senate on January 12 that seeks to amend the Tennessee Uniform Commercial Code (UCC). The proposed legislation would add the phrase “does not include any central bank digital currency” to the UCC’s definition of money, as outlined in the authorized medium of exchange.

Similarly, Utah House Representative Tyler Clancy introduced House Bill 164 on January 4, providing a comprehensive description of CBDC as a digital form of money issued by government entities such as the U.S. Federal Reserve. The proposed bill specifies that a CBDC would not be considered specie legal tender and is not legal tender in the state, thus excluding it from the Utah Specie Legal Tender Act and the state’s UCC.

South Carolina State Senator Shane Martin filed Senate Bill 861 on November 30, 2023, aiming to amend the state’s UCC definition of money by explicitly stating that it “does not include any central bank digital currency.”

In South Dakota, Senate Bill 58 was introduced on January 9 at the request of the Department of Labor and Regulation. This bill also amends the state’s UCC definition of money, emphasizing that it “does not include any central bank digital currency.”

The move to categorically exclude CBDCs from the definition of money echoes similar legislation enacted in Florida. Governor Ron DeSantis signed a bill into law that restricts the state’s acceptance and usage of CBDCs, extending the prohibition to CBDCs issued by foreign governments. The Florida legislation also called on other states to implement comparable prohibitions using their respective commercial codes.

These bills reflect a growing concern among certain U.S. states regarding the recognition and utilization of CBDCs, with potential ramifications for the broader adoption and integration of digital currencies within the country. As the regulatory landscape surrounding CBDCs continues to evolve, the outcome of these legislative efforts will play a crucial role in shaping the future of digital currency acceptance in the United States.

Image: Wallpapers.com

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