U.S. House Passes Bill Banning Federal Reserve From Issuing a CBDC

During the debate preceding Thursday’s vote, Democrats expressed their views that the concerns raised were exaggerated and that a ban could hinder progress in public sector innovation and research. The final tally saw 213 Republicans and three Democrats casting votes in favor of the bill, while 192 Democrats chose to vote against it.

On Thursdays ballot, the number of votes in favor of the Financial Innovation and Technology for the 21st Century Act, a crypto market structure bill, was significantly different from that of the previous day. Specifically, there were 71 Democrats and 208 Republicans who voted for it on Wednesday. This legislation grants more authority to the Commodity Futures Trading Commission (CFTC) in overseeing digital asset spot markets. Furthermore, it outlines the Securities and Exchange Commission’s (SEC) approach towards regulating the crypto sector.

Industry players welcomed Wednesday’s vote on the first-ever bill specifically addressing crypto market matters as evidence of the sector’s growing importance being acknowledged.

The approval of FIT21 in the House is a significant milestone and a recognition from Congress for the crypto sector in the US, according to Kristin Smith, the executive director of the Blockchain Association, a prominent industry advocacy group.

Nicole Valentine, the FinTech head at the Milken Institute, also referred to it as a “positive development.”

As a researcher studying the current political landscape surrounding central bank digital currencies (CBDCs) and their related market structures in the US Senate, I’ve noticed an intriguing pattern emerging. Regarding the CBDC-related bills under consideration, it appears that they might face similar fates due to the absence of corresponding legislation from half of the Senate. In simpler terms, the market structure and anti-CBDC bills may both stall in the Senate without gaining enough support to move forward.