U.S. Representative Warren Davidson has voiced strong concerns about the trajectory of the United States' financial system, cautioning that it is increasingly resembling a highly surveilled and controlled model. Davidson, representing Ohio since 2016, has been a vocal advocate for financial privacy and limited government control over cryptocurrency. He argues that recent legislative actions, particularly the stablecoin-focused GENIUS Act, undermine the original principles of cryptocurrency as a permissionless and private form of currency.
Davidson expressed his apprehensions about the GENIUS Act, suggesting it could pave the way for a wholesale version of a U.S. dollar central bank digital currency (CBDC). He warned that such a system could be exploited for surveillance, coercion, and control. Further, Davidson fears the potential implementation of a digital ID system, which would require Americans to obtain government permission to access their own funds. He urged the public to reject what he described as a globalist surveillance state and to return to the foundational principles of cryptocurrency, emphasizing Bitcoin's original intent as a permissionless, peer-to-peer payment system.
Echoing Davidson's concerns, Representative Marjorie Taylor Greene also voted against the GENIUS Act. Greene argued that the legislation grants excessive power to banks and creates a potential pathway for a CBDC. She also shares Davidson's warnings about the dangers of digital IDs, CBDCs, and the lack of self-custody. Both Davidson and Greene have expressed stronger support for the CLARITY Act, which is awaiting passage in the Senate and is expected to be reviewed in early 2026.
These concerns come amidst growing debate over the potential implications of CBDCs in the United States. A CBDC is a digital form of a country's fiat currency, issued and regulated by its central bank. Proponents argue that CBDCs could improve payment efficiency, reduce transaction costs, and promote financial inclusion. However, critics, like Davidson and Greene, fear that CBDCs could give the government unprecedented control over citizens' financial lives, leading to potential abuses of power and violations of privacy.
Adding to the debate, the U.S. House of Representatives recently passed the CBDC Anti-Surveillance State Act, a bill aimed at preventing the Federal Reserve from directly offering a CBDC to individuals and using it to implement monetary policy. The bill, introduced by Rep. Tom Emmer, reflects concerns over potential government surveillance of financial transactions. Emmer stated that the legislation ensures that the United States' digital currency policy remains in the hands of the American people, reflecting values of privacy, individual sovereignty, and free market competitiveness. The bill passed with limited bipartisan support and now heads to the Senate.
The Federal Reserve has maintained that it is not close to making a recommendation or adopting a CBDC. Federal Reserve Chair Jerome Powell has stated that if the central bank were to adopt a CBDC, it would be done through the banking system. However, concerns persist among some lawmakers and privacy advocates who fear that the development of digital IDs and CBDCs could lead to a surveillance state, eroding financial freedom and privacy.
