North Carolina’s General Assembly has passed a bill barring the state from accepting a Federal Reserve-issued CBDC. With Governor Roy Cooper's decision pending, the move reflects growing state-level resistance to digital currencies and highlights the evolving landscape of crypto regulations in the U.S.
In a significant development for the cryptocurrency landscape, North Carolina's General Assembly has passed a bill that could reshape how digital currencies are treated within the state. House Bill 690, which restricts the state's government from using or accepting a central bank digital currency (CBDC) issued by the Federal Reserve, now awaits Governor Roy Cooper's decision. This move follows a similar legislative action in Louisiana, positioning North Carolina as a pivotal state in the national debate over digital currency regulation.
On June 26, the bill cleared the House with a decisive 109-4 vote, a day after the Senate passed it 39-5. The broad support suggests that even if Governor Cooper decides to veto the bill, the General Assembly possesses the necessary votes to override such a decision, with over three-fifths of lawmakers in both chambers in favor.
Implications for State Agencies and Courts
If signed into law, the bill will immediately prohibit state agencies and courts from accepting payments in the form of a Federal Reserve-issued CBDC. This action represents a clear stance against the adoption of federally issued digital currencies at the state level. Additionally, the bill will prevent these entities from participating in any CBDC tests conducted by any branch of the Federal Reserve.
Echoes of Louisiana’s Legislation
The North Carolina bill mirrors recent legislation in Louisiana, where Governor Jeff Landry signed a law barring the state's government from accepting or engaging in CBDC initiatives. Notably, the Louisiana bill also included provisions safeguarding the right to self-custody of cryptocurrency, reflecting a broader protective stance towards crypto users' autonomy.
National Context and Federal Resistance
This state-level resistance comes amid mixed signals at the federal level. In March, Federal Reserve Chair Jerome Powell stated during a Senate Banking Committee hearing that the U.S. was "nowhere near recommending or adopting a central bank digital currency in any form." Despite this, the U.S. House of Representatives recently passed a bill that would ban the Federal Reserve from offering a CBDC, which is now awaiting consideration by the Senate.
Global CBDC Developments
While the U.S. remains cautious, a June 14 poll by the Bank for International Settlements (BIS) revealed that 94% of surveyed central banks are exploring CBDCs, indicating a global trend towards digital currency experimentation. The BIS noted a sharp increase in wholesale CBDC experiments and pilots, projecting that within the next six years, central banks are more likely to issue wholesale CBDCs than retail ones intended for everyday users. However, many features of these digital currencies remain undecided.
Potential Impact on the Crypto Community
For the crypto community, particularly those involved with OMGfin, North Carolina's move is a double-edged sword. On one hand, it represents a pushback against centralized digital currencies, potentially fostering a more crypto-friendly environment where decentralized currencies can thrive. On the other hand, it highlights the regulatory uncertainties that continue to loom over the crypto market, underscoring the need for stakeholders to stay informed and adaptable.
Governor Cooper's Decision: A Crucial Turning Point
Governor Roy Cooper's impending decision is pivotal. His office has not yet responded to requests for comment on his plans regarding the bill. If he signs it, North Carolina will join the ranks of states like Louisiana in taking a definitive stand against the adoption of a federal CBDC, setting a precedent for other states considering similar measures.
In summary, North Carolina's legislative action against a Federal Reserve-issued CBDC is a notable event in the evolving narrative of digital currency regulation in the United States. As Governor Cooper deliberates, the crypto community and other stakeholders await the outcome, which could have significant implications for the future of digital currencies in the state and potentially influence nationwide policies. For OMGfin users and crypto enthusiasts, staying abreast of these developments is crucial as they navigate the dynamic regulatory landscape.
(JESSE COGHLAN, COINTELEGRAPH, 2024)