FORT MYERS, Fla. – Gov. Ron DeSantis signed legislation Friday morning that bans central bank digital currency in Florida.
The governor held a news conference Friday morning at Fort Myers Technical College. DeSantis said this legislation — SB 7074 — would protect residents should the Biden Administration adopt a central bank digital currency.
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A central bank digital currency would differ in some key ways from the online and digital payments that millions of Americans already conduct. Those transactions are funneled through banks, which wouldn’t be necessary with a digital dollar, according to the Associated Press.
“Basically what it would be is something that would be controlled by like the Fed, it would be a digital, ‘digital dollar,’” DeSantis said. “... Once they then have the ability to run a central bank digital currency, they’re gonna be able to have the window into what you’re doing with the money and the ability to control where that money is going.”
While there is no official central bank digital currency, DeSantis proposed the legislation in March while the government was looking into it and “to be a state that supports innovation in the financial sector through the market, while protecting against government surveillance over your personal finances.”
A digital dollar could bring a host of benefits as well as risks. It would be a safer form of digital payment, because the Fed, unlike a bank or the companies issuing stablecoins, can’t go bankrupt. It could be easier and less expensive to access for people without bank accounts.
At the same time, a digital currency could pose privacy risks because it would be issued by the government. The Fed’s paper suggests, though, that banks and other third-party firms would shield consumer data from the Fed while also implementing existing rules against money-laundering and other illicit activity.
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Such a government-issued digital dollar could also have major consequences for commercial banks because many Americans might prefer to hold such currency in a “wallet” issued by a payment provider like PayPal or Venmo, potentially cutting into bank deposits.
“And I’m just glad that we’re thinking ahead here in the state of Florida because once the genie’s out of the bottle, I think it’d be very hard to put back in. You know, the cash is king like when you have that, you control your own destiny. If you’re relying on some digital system and you have no other recourse and is controlled by a central authority, and you’re putting your independence in their hands and I don’t think we want to do that,” the governor said.
The legislation will:
- Expressly prohibit the use of a federally adopted Central Bank Digital Currency as money within Florida’s Uniform Commercial Code (UCC).
- Institute protections against a central global currency by prohibiting any CBDC issued by a foreign reserve or foreign sanctioned central bank.
- Call on like-minded states to join Florida in adopting similar prohibitions within their respective Commercial Codes to fight back against this concept nationwide.
DeSantis also signed SB 214, which prohibits credit card companies from tracking firearm and ammunition sales using MCC codes.
The governor was joined by Commissioner of Agriculture Wilton Simpson and Florida Senate President Kathleen Passidomo for the news conference.
The Associated Press contributed to this report.
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