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House Financial Services Subcommittee Hearing on Digital Dollar, Updates on Witnesses, Shares Legislation to Limit CBDC Issuance

House Financial Services Subcommittee Releases Witnesses for Hearing on Digital Dollar

The House Financial Services Subcommittee on Digital Assets, Financial Technology, and Inclusion has announced the witnesses for its upcoming hearing on a digital dollar. The hearing, titled “The Digital Dollar Dilemma: The Implications of a Central Bank Digital Currency and Private Sector Alternatives,” will address the potential impact of a central bank digital currency (CBDC) and examine private sector alternatives.

Scheduled to testify at the hearing are prominent industry leaders and experts. Yuval Rooz, Co-Founder and CEO of Digital Asset, will share insights on the role of digital assets in the financial ecosystem. Paige Paridon, Senior Vice President and Senior Associate General Counsel at the Bank Policy Institute, will provide legal perspectives on CBDC issuance. Christina Parajon Skinner, Assistant Professor at The Wharton School of the University of Pennsylvania, will bring academic insights to the discussion. Dr. Norbert Michel, Vice President and Director of the Center for Monetary and Financial Alternatives at the Cato Institute, will contribute his expertise on monetary policy. Raúl Carrillo, Academic Fellow and Lecturer in Law at Columbia Law School, will provide a legal perspective.

The hearing will also be accompanied by several bills that seek to regulate the issuance of a CBDC. The “Power of the Mint Act” (HR 3402) proposes that the US Federal Reserve must obtain Congressional authority before issuing a CBDC. Another bill, the Digital Dollar Pilot Prevention Act (HR 3712), aims to prevent the Federal Reserve from conducting digital dollar pilot tests without explicit instruction from Congress. The CBDC Anti-Surveillance State Act is another bill that seeks to limit the potential use of a CBDC for purposes beyond simple value transfer.

The issuance of a CBDC has sparked controversy in the United States due to concerns about the potential for increased tracking of transactions by private and public entities. Furthermore, a CBDC could potentially be leveraged to achieve other policy goals or even render traditional banks’ deposit-holding services obsolete. While a final decision on implementing a CBDC has not been made, other countries, such as China and the EU, have taken steps towards digital currency adoption.

The upcoming hearing, which will be live-streamed on the Committee’s website, is scheduled for September 14, 2023, at 2 p.m. It will provide a platform for industry leaders, legal experts, and academics to provide insights and perspectives on the digital dollar dilemma. Some experts argue that a digital dollar could strengthen its position as the world’s reserve currency, while others suggest that a well-regulated stablecoin issuer could achieve similar results, addressing concerns regarding privacy and potential risks.

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