North Carolina’s legislature has taken a strong stance against a potential central bank digital currency (CBDC) by passing a bill that restricts state agencies from using or accepting it. House Bill 690 sailed through both chambers with overwhelming support (109-4 in the House and 39-5 in the Senate) and now awaits Governor Roy Cooper’s signature.
The bill, if enacted, would effectively bar state entities and courts from receiving payments in CBDC and from participating in any testing programs conducted by the Federal Reserve. This move comes just days after Louisiana enacted similar legislation, highlighting a growing national skepticism towards CBDCs.
Governor Cooper’s position on the bill remains unclear, although a veto is unlikely to succeed given the significant legislative support. Interestingly, Federal Reserve Chair Jerome Powell has downplayed the possibility of an immediate CBDC rollout, stating the U.S. is nowhere near adoption.
Despite this, a recent congressional bill aims to pre-empt the Fed from issuing a CBDC, and a Bank for International Settlements (BIS) survey reveals a surge in central bank exploration of the technology. While the BIS predicts a higher likelihood of wholesale CBDCs (used by financial institutions) in the near future, the overall design and implementation of CBDCs remain in flux. This North Carolina legislation underscores the ongoing national debate about the potential benefits and risks of central bank digital currencies.
