As he was campaigning in New Hampshire, former President Donald Trump made a promise to block the formation of a central bank digital currency (CBDC) in the United States if he were to be reelected. He referred to the creation of such a currency as a “dangerous threat to freedom.” He issued a warning that a CBDC would provide the federal government with “absolute control over your money” and the potential to take monies without the knowledge of individuals without their consent.
Trump made the following statement: “As your President, I will never permit the creation of a central bank digital currency. This is to protect the American people from the tyranny of the government.”
As he strives to attract supporters who are in favor of cryptocurrencies, Trump has taken a position that is a departure from his past pessimism toward cryptocurrencies. He has distributed a large number of NFT collections and has made millions of dollars in Ethereum from the sales of these collections. Vivek Ramaswamy, a crypto-friendly former presidential candidate who pulled out of the campaign to support Trump, joined Trump on stage. Ramaswamy was a prominent supporter of the cryptocurrency.
It is consistent with the opinions of other Republican contenders, like Florida Governor Ron DeSantis, that the previous President has committed to preventing CBDCs from being established. “End Biden’s war on Bitcoin” is one of the promises that DeSantis has made, and he has also prohibited CBDCs in the state. Additionally, he has declared that the state of Florida will accept Bitcoin as a form of payment for state taxes issued by businesses.
In the course of the campaign trail, the question of cryptocurrencies and CBDCs has emerged as a contentious topic of discussion. Candidates are increasingly taking stances on these issues in order to appeal to voters as the country moves into the election cycle that will take place in 2024.
The population that is opposed to central bank digital currency (CBDC) has just received a prominent voice to convey their message. Former President of the United States and current candidate for the Republican presidential nomination Donald Trump has pledged that he will “never allow” the Federal Reserve to construct a digital dollar if he is re-elected.
The remark was made by Trump on Wednesday, as he was giving a campaign address in Portsmouth, New Hampshire. In his statement, he stated, “Tonight, I am making another promise to protect Americans from the tyranny of the government.” I will never provide permission for the establishment of a digital currency issued by a central bank.
In response to the comment, the crowd that was present gave Trump a round of applause and cheered the talking point that is employed by individuals who warn against the overreach of the government, particularly when it comes to matters concerning personal wealth.
“I had no idea that you knew so much about… In response to the crowd’s reaction to his statement, Trump said, “New Hampshire, which is home to a very intelligent population.”
“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 very dangerous situation.” I will prevent this from arriving to the United States of America because it poses a significant risk to the freedom of the people.
In addition, the former President addressed the concerns that certain individuals had regarding the restriction of bank access as a sort of political censorship.
“In addition, we are going to put in place robust safeguards to prevent financial institutions and government regulators from attempting to de-bank you because of your political beliefs,” he stated. “As long as I am serving as your president, that will never take place.”
The anti-central bank digital currency (CBDC) stance is gaining support among Republicans and has been on the increase since the beginning of 2023, when Ron DeSantis, a presidential candidate and the governor of Florida, made a commitment to “nix” central bank digital currencies on his first day as president.
Additionally, DeSantis was the driving force behind the legislation in Florida that prohibits the use of CBDCs issued by foreign governments and places restrictions on the usage of a digital currency within the state.
The results of the Iowa caucus that took place on Monday indicate that Donald Trump has a significant lead over the other contenders in the contest to earn the Republican nomination for president. If nothing unexpected happens, it is highly likely that Trump will be the nominee for president.
In spite of the fact that the issuance of a digital currency is becoming an increasingly contentious issue, the Federal Reserve has maintained a relatively low profile regarding the subject. As stated on the website of the central bank, “The Federal Reserve has not yet made a decision regarding the issuance of a central bank digital currency and would only proceed with the issuance of a CBDC if an authorizing law were to be passed.”
In March of 2023, when testifying before the House Financial Services Committee, Federal Reserve Chair Powell stated that a central bank digital currency is “something we would certainly need Congressional approval for.”
Michelle Bowman, the Governor of the Federal Reserve, stated in October that she has not yet heard a strong justification for a CBDC in the United States and that other alternatives may handle the problems that need to be solved financially.
“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 stated during his prepared remarks. “These risks and tradeoffs include potential unintended consequences for the U.S. banking system and considerable consumer privacy concerns.”
The threat to privacy was another issue that Bowman brought up, echoing many of the issues that were brought up by the crowd that was against the CBDC.
“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,” said the researcher.
However, the fact that 130 countries, which account for 98 percent of the global GDP, are currently 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. In the end, it is possible that even the President will not be able to do anything to prevent the eventual issuance of a digital dollar.