A central bank digital currency (CBDC) could negatively impact credit unions and pose broader financial security risks, America’s Credit Unions President/CEO Jim Nussle wrote House Majority Whip Tom Emmer, R-Minn., and Sen. Ted Cruz, R-Texas, who introduced legislation (S.3801/H.R. 5403) that would bar the Federal Reserve from issuing a CBDC.
“If the Federal Reserve were to offer a CBDC directly to consumers, it would be in essence offering consumer accounts, which would constitute a massive expansion of its mission and threaten to erode the financial system,” wrote Nussle. “We expect that the net costs of a CBDC will exceed the benefits, and that administration of a CBDC will distract from the Federal Reserve’s dual mandate of achieving both stable prices and maximum sustainable employment.”
America’s Credit Unions believes that because the underlying regulations for a CBDC have not yet been developed and properly vetted, it is impossible to anticipate the privacy concerns and other trade-offs that might come from a CBDC.
