Democratic Lawmakers Condemn Cryptocurrencies
During a press conference held on Wednesday, Democratic lawmakers in the United States openly condemned cryptocurrencies, labeling them as “scams” and advocating for the introduction of a central bank digital currency (CBDC).
Criticism of Anti-CBDC Legislation
Representative Maxine Waters denounced a proposed bill intended to prevent the establishment of a government-backed digital dollar, dubbing it the “anti-innovation act.” Waters insisted that both the anti-CBDC legislation and the GENIUS stablecoin initiative pose threats to national security.
Concerns Over Cryptocurrency Use
Representative Stephen Lynch joined Waters at the event, emphasizing that to date, there has been no valid use case for cryptocurrency.
“As a committee, we’ve discovered that cryptocurrency merely serves illegal actions, like ransomware attacks that have harmed US businesses, all of which have been facilitated through these digital currencies,”
Lynch declared. He further remarked,
“It’s a highly volatile and risky asset with no role in a stable and regulated financial environment. This industry is nothing but a scam.”
Global Perspectives on CBDCs
In a related note, earlier this year, former President Donald Trump issued an executive order banning the creation of CBDCs. The landscape surrounding CBDCs remains complex, with many nations taking steps to digitize their fiat currencies. On the other hand, Federal Reserve Chair Jerome Powell stated during a Senate hearing in February that under his leadership, a CBDC would not be pursued. In contrast, the Reserve Bank of India announced plans in May to accelerate its CBDC testing, aiming to explore innovative applications for its digital rupee. Additionally, Australia’s central bank revealed testing plans for wholesale CBDCs in collaboration with selected institutions.
Concerns from Financial Leaders
Conversely, Bank of England Governor Andrew Bailey expressed concerns regarding the potential risks of a CBDC, suggesting that it could undermine the stability of the banking sector. He proposed that the focus should instead be on tokenizing deposits. Overall, the debate surrounding cryptocurrencies and CBDCs continues to evoke starkly divergent views among lawmakers and financial leaders.
