In a controversial move, North Carolina’s lawmakers have successfully overturned Governor Roy Cooper’s veto on a bill that aimed to prevent the state from implementing a central bank digital currency (CBDC). The Republican-controlled Senate voted 27-17 in favor of House Bill 690, surpassing the required 60% threshold to override the governor’s rejection. This decision effectively blocks North Carolina from accepting payments in a CBDC and participating in the Federal Reserve’s CBDC trials.
Governor Cooper vetoed the bill back in July, citing lack of clarity and labeling it as a reactionary measure. He expressed concerns that the bill did not address immediate threats and urged lawmakers to focus on cybersecurity-related budget matters instead. However, this move was criticized by Dan Spuller, head of industry affairs at the Blockchain Association, who viewed the veto as a missed opportunity to take a firm stand against CBDCs. He applauded North Carolina lawmakers for demonstrating leadership in keeping digital assets policy in the hands of the American people, ensuring that the development of digital currency aligns with values of privacy, individual sovereignty, and free market competitiveness.
Central bank digital currencies (CBDCs) are digital representations of government-issued currencies that leverage blockchain technology to facilitate fiat currency transactions. The Atlantic Council’s CBDC tracker reveals a growing trend of CBDCs globally, with countries representing 98% of global GDP exploring their implementation. Organizations like the International Monetary Fund (IMF) have highlighted the potential benefits of CBDCs in promoting economic inclusion and reducing the costs of financial services. However, there are concerns that the issuance of CBDCs could impact the financial stability of the issuing country.
CBDCs have become a contentious issue in the United States, with differing viewpoints among political parties. Democrats, including Senator Elizabeth Warren, advocate for the use of CBDCs, while Republicans like former President Donald Trump oppose them. The Federal Reserve, the country’s central bank, has yet to make a decision on launching a CBDC, emphasizing the need for legal authorization before proceeding with such an initiative.