POLITICS + GOVERNMENT

Bill banning Central Bank Digital Currency one step closer to becoming law

Jan 24, 2024, 12:00 PM

Rep. Tyler Clancy, R-Provo, speaks during the House Economic Development and Workforce Services Sta...

Rep. Tyler Clancy, R-Provo, speaks during the House Economic Development and Workforce Services Standing Committee hearing at the East Senate Building on Capitol Hill in Salt Lake City on Tuesday, Jan. 23, 2024. (Megan Nielsen, Deseret News)

(Megan Nielsen, Deseret News)

SALT LAKE CITY — A Utah House Committee has approved a bill making it against the law to use Central Bank Digital Currency in the Beehive State.

Central Bank Digital Currency – or CBDC – is a digital monetary system controlled by a central bank like the Federal Reserve. It bypasses traditional banks and credit unions.

The bill’s sponsor, Rep. Tyler Clancy, R-Salt Lake City, said one of the big challenges with CBDC is it puts people’s privacy at risk.

“Consumer privacy is not a partisan issue, as I’ve talked to constituents and people in the community about the importance for this. It’s widely recognized to say, ‘Yep. I’d like politicians to stay two steps away from my bank account,'” Clancy said.

 CBDC differs from traditional transfers like Venmo and Zell. When CBDC is used, the financial institution that issued the currency knows everything about the purchase.

“Howard Headley from Utah Bankers Association explained in committee that CBDC moves around the financial institutions that…Utah families know and trust and goes direct to the consumer. The problem with this is that means now your financial decisions are going to be influenced by politics,” said Clancy.

According to Clancy, CBDC is not a cryptocurrency. Clancy said CBDC is not a cryptocurrency because CBDC is controlled by one central entity. Cryptocurrencies are decentralized. 

The bill passed out of committee with a unanimous vote.

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Bill banning Central Bank Digital Currency one step closer to becoming law