Roy Cooper, the governor of North Carolina, struck off a bill that would have banned the state from receiving payments in U.S. Federal Reserve-issued central bank digital currency (CBDC) on June 5. House Bill No. 690 would have also restricted the state from participating in any CBDC testing by the Federal Reserve.
In a statement, Cooper noted that efforts are underway at the federal level to ensure that any CBDC has appropriate standards and safeguards for consumers. Vetoing the bill leaves the door open for those who may want to conduct transactions using CBDC, he added.
Cooper stated that North Carolina should “wait to see” how CBDCs work before making a final decision. The bill, as it was, was unsuitable for passing into law, Cooper said, adding:
“This legislation is premature, vague and reactionary and proposes an end result on important monetary decisions that haven’t even been made yet.”
Cooper also said that the legislature should have allocated more funding to tackle current cybersecurity threats rather than passing the now-vetoed bill.
In March, Federal Reserve Chair Jerome Powell said at a Senate Banking Committee hearing that the US was “nowhere near recommending or let alone adopting a central bank digital currency in any form.”
Governor criticized for vetoing bill
Cooper has received wide criticism for his veto of the bill that secured a vast majority of votes in both the House of Representatives and the Senate. The bill, which was filed in April 2023, received only four votes against it compared to 109 votes in favor in the House of Representatives while five voted against it in the Senate compared to 39 in favor.
According to Dan Spuller, head of industry affairs at the Blockchain Association, expressed his disappointment at the veto in an X post on July 6, noting that:
“By vetoing this bill, @NC_Governor missed an opportunity to send a clear message to the @FederalReserve that North Carolina stands united against the creation of a #CBDC.”
Spuller added that any policy related to digital assets should “remain in the hands of the American people” to ensure that they reflect “our values of privacy, individual sovereignty, and free market competitiveness.”
Since the bill received near-unanimous support in the House of Representatives and the Senate, legislators can easily overturn the veto with a three-fifths majority in both chambers. As Spuller said, “This veto must be overridden.”
It is worth noting that North Carolina is not the only state with an anti-CBDC bill in the works. Florida passed a legislature to ban the use of CBDCs in the state amid concerns around state-controlled surveillance.
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