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Investing.com – Former US president and 2024 presidential candidate Donald Trump has vowed to “never allow” the Fed to create a central bank digital currency (CBDC) in the United States.
Speaking during a campaign speech in Portsmouth, New Hampshire on Wednesday, Trump said, “Tonight, I’m making another promise to protect Americans from government tyranny,” namely that he “won’t will ever authorize the creation of a digital currency by a central bank”.
He went on to explain that “such a currency would give a federal government, our federal government, absolute control of your money […] They could take your money, and you wouldn’t even know it was missing.”
“It would be a dangerous threat to freedom, and I will prevent it from coming to America,” he added.
It should be noted that the idea of CBDCs is often criticized, because their use would indeed confer great power to the governments that control them, with perfect traceability of funds, and the possibility of freezing a person’s resources very easily.
Furthermore, the programming capabilities of a CBDC could make it possible to prohibit the purchase of certain goods or limit the quantities purchased. For example, policymakers could try to reduce alcohol consumption by limiting late-night alcohol purchases or banning purchases by people who have committed alcohol-related crimes, as outlined in a Cato Institute brief on risks of CBDCs.
The head of the Fed Jerome Powell himself is not convinced, having declared in June that “we would not want a world in which the government would see, in real time, every transfer of money carried out by a CBDC”.