Congress Reignites Debate Over Digital Dollar as Global Race Accelerates

Lawmakers have reignited the contentious debate over whether the U.S. should issue a central bank digital currency (CBDC). Critics, led by Representative Tom Emmer, warn of potential surveillance risks, arguing a retail CBDC could undermine financial privacy. Emmer's Anti-CBDC Surveillance State Act, already passed in the House, aims to block what he describes as 'programmable money' lacking cash-like anonymity.

Proponents counter that the discussion often overlooks critical nuances. Sheila Warren of the Project Liberty Institute emphasizes that the Federal Reserve cannot unilaterally launch a CBDC—Congress must approve any design, including privacy safeguards. The polarized rhetoric, she suggests, reflects political posturing rather than substantive technological concerns.

Globally, momentum for CBDCs is accelerating. China's e-CNY circulates actively, while Europe and India advance pilot programs. The U.S., however, lags behind. Warren sees limited potential for wholesale CBDCs in interbank settlements but remains doubtful about a retail digital dollar ever materializing.