Ted Cruz has joined a host of politicians to show their disdain for CBDC in America – but what about pro-Bitcoin legislation?
Texas Governor Ted Cruz has joined a growing group of politicians who have come out in support of an anti-CBDC bill, reintroducing legislation to the Senate that would ban direct-to-consumer Federal Reserve-issued CBDC.
The past week has seen several US state politicians at the center of the action. The trend appears to have started with the introduction of Congressman Tom Emmer’s “CBD Anti-Surveillance State Act,” a bill that would prohibit the Federal Reserve from issuing CBDC directly to anyone.
This was followed by South Dakota Governor Kristi Noem’s decision to veto House Bill 1193, which would have amended provisions of the Uniform Commercial Code in the state. “The bill uses the definition of ‘money’ to exclude cryptocurrencies. But the revision includes Central Bank Digital Currency as money. This development is concerned for several reasons,” Governor Noem explained.
After that, Florida Governor Ron Desantis held a press conference where he stood at a podium labeled “Big Brother’s Digital Dollar,” announcing that Florida would become a CBDC-free state.
However, in a recent article written for the Bitcoin Policy Institute titled “In Attempt to Stop CBDCs, States Are Rejecting Ostensibly Pro-Bitcoin Legislation,” Yaël Ossowski explains how House Bill 1193 was blocked by Gov. Noem will actually benefit bitcoin, not net negative. In his opinion, the response to House Bill 1193 does not take into account all the changes in the Uniform Commercial Code, and he warned politicians to be careful not to block bills that could benefit bitcoin.
“The bill – based on the update of the Uniform Commercial Code – not only expands the definition and protection for Bitcoin, but actually creates a legal mechanism to recognize rights and to include protocols in traditional credit, insurance, and commercial transactions. ,” he wrote. “Having CBDC-bashing as the latest litmus test for conservative politicians is revolutionary, and from the point of view of individual and economic freedom that Bitcoin provides, is a positive phenomenon. But why is the war being played out on the commercial code of a basic country that has nothing to do with Central Bank Digital Currency?
Ossowski explained how, for conservatives, this bill is a “backdoor to CBDC and federal government control of economic freedom.” Because it provides a precise definition of money that does not include Bitcoin, it is considered that CBDC is the government that will become money. However, this should not be taken for granted, and leaving bitcoin in the definition is actually positive, according to Ossowski. “Not being defined as money means that Bitcoin transactions are not recognized as money transmissions, which would require various licenses, permits, and legal registrations,” he wrote.
“Overall, that keeps the Bitcoin protocol outside the regulatory scope of the restrictive rules that apply to legal tender like the US dollar.”
Ossowski also mentions the “Catawba Digital Economic Zone, Web3’s self-dubbed special economic zone enabled by law of the Catawba Indian Nation of the Carolinas.” In August 2022, it became the first quasi-jurisdiction to implement Article 12 of the Uniform Commercial Code.
He thinks this bill gives bitcoin a better legal footing, not a worse one.
“Unlike previous efforts to consolidate digital assets under existing law, the amendment is directly in the UCC. It provides greater certainty, simplicity, and uniformity. The amendment approved on July 15 also addresses all the major issues with other related efforts, including issues of security control, perfection, priority, and custodial The amendment is progressive, and technology neutral.
However, Ossowski concluded that it is understandable why Governor Noem vetoed the bill. “While his understanding of the bill was flawed, his instincts were right,” he said. “The same applies to DeSantis’ mission to snipe CBDCs before they reach Florida’s beaches.”
He suggested that state lawmakers who recognize the benefits of Article 12 for Bitcoin, and who want to express political opposition to the CBDC, should simply write that statement into their version of the bill.
“Pushed into this political juncture, we cannot fault the governor and the legislature for wanting to plant the anti-CBDC flag,” he wrote. “However, we must remind you that a technical update of the commercial legal code that will benefit Bitcoin is desirable and necessary.
Ideally, countries will adopt better model policies that will help the cause of decentralized digital cash in the form of Bitcoin while keeping CBDC on the table. But our work has only just begun.”
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