Sponsor
Jake Auchincloss
Representative · D-MA
Representative · D-MA
The bill preserves Congressional control and prevents an unapproved Fed-issued digital currency—protecting citizens' control over monetary innovations—but risks constraining Fed independence, creating legal uncertainty for markets, and slowing potentially cost-saving payment innovation and rapid crisis responses.
Households and businesses (taxpayers) are protected from an unapproved Federal Reserve–issued digital currency: the Fed cannot deploy a CBDC for general use without explicit congressional authorization.
Taxpayers and financial institutions retain Congressional control over major monetary-policy innovations and financial-system design, ensuring elected representatives decide whether to authorize a CBDC or other structural changes.
Financial institutions (Federal Reserve Banks) are explicitly recognized as fiscal agents and potential depositories for the U.S. Treasury, clarifying operational roles for banks and Treasury operations.
Financial institutions and the broader economy could face constraints on Federal Reserve independence because the bill’s language might be used to challenge or limit independent monetary-policy decisions.
Financial institutions and markets could experience legal uncertainty about existing Fed practices if the bill is used to justify statutory changes, potentially disrupting markets that rely on current Fed authorities.
Taxpayers and financial institutions could lose a rapid policy tool in a crisis because the bill could limit policymakers’ ability to deploy a CBDC quickly in response to fast-moving financial risks.
Based on analysis of 3 sections of legislative text.
Requires explicit congressional authorization before the Federal Reserve or Treasury may issue or direct issuance of a central bank digital currency.
Official title: To prohibit the Board of Governors of the Federal Reserve and the Secretary of the Treasury from issuing a central bank digital currency, and for other purposes.
Introduced July 16, 2025 by Jake Auchincloss · Last progress July 16, 2025
Prohibits the Federal Reserve and the Secretary of the Treasury from issuing or directing issuance of a central bank digital currency (CBDC) unless Congress passes a law explicitly authorizing it. It states congressional findings about Congress’s constitutional power to coin money and the role of Federal Reserve Banks as fiscal agents, and creates affirmative statutory prohibitions that require congressional approval before a CBDC can be issued.