House committee Republicans issue CBDC principles

House Financial Services Committee Republicans released principles to guide Congress in evaluating potential proposals for a U.S. central bank digital currency.

Details: The principles say any U.S. CBDC should:

• Maintain the dollar as the world’s reserve currency.

• Maintain the preeminence of the U.S. payment system.

• Not impede stablecoin development.

• Support digital currency policies that promote private-sector innovation.

• Ensure privacy and security protections.

Next: With policymakers debating CBDC and digital asset oversight, committee Democrats continue developing their own policy views of CBDC while the Federal Reserve works on a U.S. CBDC paper.

Stablecoins: Separately, the Financial Stability Oversight Council met to discuss, among other things, a President’s Working Group report on stablecoins, which recommended bank-like rules for stablecoin issuers. ICBA recently said it supports the group’s efforts to support a consistent federal regulatory framework.

More: Recent ICBA blog posts detail where nations stack up in developing CBDCs, growing stablecoin risks to consumers and the financial system, how policymakers are responding, and what decentralized finance means for community banks.