On March 9, the administration headed by former Vice President Joe Biden issued a sweeping string of executive orders directed at a long list of agencies to devise regulations for cryptocurrencies such as Bitcoin, as well as make a plan to study the potential creation of a central bank digital currency (CBDC) for the country.
The government and the Federal Reserve would be making the first issuance in a hundred years of a completely new currency if the United States were to issue an international CBDC.
Despite the language in President Trump's executive order about digital dollars not needing to be created, evidence supports the opposite assessment, meaning that the White House will initiate a plan for a digital currency within the next 12 months.
Federal Reserve officials were considering the potential of a digital currency in 2022 when they released a report analyzing digital currencies.
According to Biden's executive order, Congress can now look at legislation to implement a virtual currency within 210 days of the order.
Some features could consider this digital dollar instead of our current paper dollar. The U.S. Federal Reserve would continue to issue monetary policy and interest rates similar to our currency, and people would be able to pay their vendors with their existing bank accounts and credit and debit cards.
But there are also several significant differences. First, a bitcoin does not, by definition, exist in hard copy. Once the transition is complete, you will not be able to go to a bank or ATM, and you can't get actual money from an account that contains your digital currency.
In the future, if a particular digital or virtual currency were designed, government and the Federal Reserve would have substantial control over its use and distribution. The Federal Reserve could, for example, make more digital dollars and dispense them at the push of a button.
Digital dollars could be used for many different kinds of purchases, as could the accumulation of digital dollars. They could additionally be used toward the sorts of products people could purchase, how much could be purchased at any particular time, or some other factor.
In short, creating a digital currency might introduce the most significant increase in federal power in history, depending on its structure.
Over the subsequent weeks and months, advocates of an electronic dollar might express these worries are unfounded or even "conspiracy theories." However, there are many reasons to suppose a digital dollar like the one the White House is considering would be used to manage the U.S. economic sector and, in fact, society.
The executive orders of the Biden administration demonstrate that "financial inclusion and equity" and limiting "climate change and pollution" should be vital considerations in the development of a new central bank digital currency or digital asset regulatory scheme.
During a background call with the press about the executive order, a "senior administration official"—their name was not published in the administration's call transcript—promised that the White House would "continue to partner with all stakeholders" in the development of a new digital currency, "including industry, labor, consumer, and environmental groups, interns, and experts."
Why would discussions on using a digital dollar occur with such a wide range of "stakeholders" until the Biden administration was creating that CBDC programmable?
Advances in digital currency should be a concern for everyone, no matter who they are and what they believe. Once the digital currency is there, law enforcers and government officials may wield more power over citizens and their companies.
Most people don't want the federal government and the Federal Reserve to possess much control over their own lives. The question that must be addressed is whether enough people will come to their senses before it's too late.