The governor of Florida Ron DeSantis has signed into law a new bill that forbids the use of a central bank digital currency (CBDC). Another bill signed on Friday 12 May also prevents credit card companies from tracking gun sales in the state.
The bill on CBDC (SB 7054) prevents the use of a federal reserve-issued digital currency or that from any other government from being used in the state under its Uniform Commercial Code. The bill was overwhelmingly passed by the legislature which is predominantly Republican.
According to DeSantis, the bill is an attempt to prevent the Democratic Biden-led government from deciding how people spend their money. The second bill (SB 214) will prevent credit card companies from using a separate “merchant category code” for sales at gun businesses in Florida.
“They’re going to be able to have the window into what you’re doing with the money and the ability to control where that money is going. They could block, if you filled up your gas tank too much, hey, they’re fighting global warming, You can’t do any more.’ Maybe you bought a firearm last week. They don’t want you to buy another one this week,” DeSantis said during an event in Fort Myers.
Credit card companies Visa, Mastercard, and American Express announced plans to categorize gun-shop sales last year. Since then, gun and ammunition purchases have been categorized separately, but that is about to change with the new bill.
The Move for a CBDC
Last year, president Joe Biden signed an executive order directing officials to examine the risks and benefits of cryptocurrencies. The order also demanded recommendations on a central bank digital currency issued by the federal reserve.
While a CBDC is built on a blockchain, it is controlled by the Fed and also has characteristics such as the value being fixed by the Fed. With a CBDC, the central bank will be able to track how every account owner spends his or her money.
There is renewed effort currently to develop the CBDC to compete with cryptocurrencies. However, Microstrategy co-founder Michael Saylor says such a move will only increase demand for cryptocurrencies such as Bitcoin.
While the move is being supported by Democrat lawmakers, Republicans have kicked against it, making the project to be kept on hold at the moment.
Crypto Battle in the US
The US has been very harsh on the crypto space. Cryptocurrencies are considered to be rivals against the US Dollar, which has been destroyed by inflation. In order to create a competition against Bitcoin, the government is pursuing a CBDC.
This could be why the goverment has been unfriendly towards the crypto space. Even without any crypto regulations, regulators such as the SEC have been handing out sanctions to crypto companies, a development that has caused many crypto companies to leave the country.
As Florida has kicked against a CBDC, there may be other states that also think a Fed-issued digital dollar may be a bad idea. This means that a CBDC may not be well received, and may indeed push more people to Bitcoin eventually.
DeSantis is also known for his support of cryptocurrencies that are not associated with a CBDC. He has publicly expressed support for Bitcoin and stated that the state welcomes the top digital currency and any other decentralized digital currency.