The anti-central bank digital currency (CBDC) crowd just got a prominent voice to spread their message as former U.S. President and current Republican Presidential candidate Donald Trump vowed to “never allow” the Federal Reserve to create a digital dollar if he is re-elected.
Trump made the comment on Wednesday during a campaign speech in Portsmouth, New Hampshire. “Tonight I’m making another promise to protect Americans from government tyranny,” he said. “I will never allow the creation of a central bank digital currency.”
The crowd in attendance responded positively to the statement, giving Trump a round of applause and cheering the talking point used by those who caution against government overreach, especially when it comes to personal finances.
“I didn’t know you know so much … New Hampshire, very smart people,” Trump said in response to the crowd’s reaction to his statement.
“Such a currency would give a federal government, our federal government, the absolute control over your money […] they could take your money, and you wouldn’t even know it was gone,” he added. “This would be a dangerous threat to freedom, and I will stop it from coming to America.”
The former President also addressed concerns held by some about limiting bank access as a form of political censorship.
“We are also going to put in place strong protections to stop banks and regulators from trying to de-bank you for your political beliefs,” he said. “That will never happen while I am your president.”
The anti-CBDC stance is growing in popularity among Republicans and has been on the rise since early 2023 when presidential candidate and Florida Governor Ron DeSantis pledged to “nix” central bank digital currencies on his first day as President.
DeSantis was also the driving force behind legislation in Florida that restricts the state’s use of a digital dollar and banned using CBDCs issued by foreign governments.
Based on the results of the Iowa caucus that took place on Monday, Trump holds a substantial lead over the other candidates in the race to secure the Republican nomination for President and will likely become the nominee, barring any unforeseen developments.
While the issuance of a digital dollar is a growing area of contention, the Federal Reserve has stayed relatively quiet on the matter. According to the central bank’s website, “The Federal Reserve has made no decision on issuing a central bank digital currency and would only proceed with the issuance of a CBDC with an authorizing law.”
During testimony before the House Financial Services Committee in March 2023, Fed Chair Powell said a central bank digital currency is “something we would certainly need Congressional approval for.”
In October, Fed Governor Michelle Bowman said that she has not yet seen a compelling argument for a U.S. CBDC and that other alternatives could solve financial challenges.
“The potential benefits of a U.S. CBDC remain unclear, and the introduction of a U.S. CBDC could pose significant risks and tradeoffs for the financial system,” Bowman said in prepared remarks. “These risks and tradeoffs include potential unintended consequences for the U.S. banking system and considerable consumer privacy concerns.”
Echoing many of the concerns highlighted by the anti-CBDC crowd, Bowman also touched on the threat to privacy.
“In thinking about the implications of CBDC and privacy, we must also consider the central role that money plays in our daily lives, and the risk that a CBDC would provide not only a window into, but potentially an impediment to, the freedom Americans enjoy in choosing how money and resources are used and invested,” she said.
But the fact that 130 countries, representing 98 percent of global GDP, are in some stage of exploring the creation and issuance of a CBDC suggests that it will continue to be a topic of discussion moving forward, and in the end, there might not be anything even the President can do to stop the eventual issuance of a digital dollar.
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