Key Points
- Blockchain Association urges Senate to reject retail CBDC over privacy concerns.
- Group supports regulated private stablecoins under pending legislation.
The Blockchain Association, representing over 100 crypto firms, has formally urged U.S. Senate leaders to oppose the creation of a retail Central Bank Digital Currency (CBDC).
In its letter, the group argues that a government-issued digital dollar could threaten financial privacy and undermine the regulated private stablecoin framework lawmakers have been developing.
The request relates to ongoing legislative efforts, including the GENIUS Act and the Digital Asset Market Clarity Act (H.R. 3633), which aim to establish rules for digital asset markets and stablecoins.
Privacy Concerns and Structural Risks
The association’s position centers on the structural design of a retail CBDC rather than general objections to digital payments.
It argues that a CBDC issued directly by the Federal Reserve and held in consumer-accessible accounts would record transactions on a government-managed ledger.
Under such a system, federal authorities could potentially access comprehensive transaction histories, depending on legal standards established by Congress.
The group contrasts this with existing commercial bank systems, where access to financial records typically involves subpoena processes and regulatory thresholds under current law.
According to the letter, a central bank-operated ledger would combine recordkeeping and access authority within the same institution, reducing procedural barriers that currently exist.
The association characterizes this structure as inherently sensitive from a surveillance standpoint, noting that statutory privacy protections may evolve through legislative amendments or regulatory changes over time.
Legislative Context and Stablecoin Policy
The letter arrives as Congress continues debating digital asset oversight and stablecoin regulation.
The Federal Reserve stated in its January 2022 discussion paper that it would only pursue a retail CBDC with clear authorization from both Congress and the executive branch.
Following Executive Order 14067 in March 2022, federal agencies conducted assessments on the potential development of a digital dollar.
The current congressional environment reflects increased attention to private-sector stablecoin models as an alternative to a federally issued digital currency.
By opposing a retail CBDC while promoting regulatory clarity for private stablecoins, the Blockchain Association aims to shape the direction of federal digital asset policy during ongoing legislative negotiations.
