Central Bank Digital Currencies and the Uniform Commercial Code

Published December 1, 2023

Central bank digital currencies (CBDCs) have only recently become a widely discussed topic among influential figures in academia, media, and public policy institutions. However, initiatives to implement CBDCs around the globe have existed for years, especially in countries with autocratic governments, such as China and Russia. As of September 2023, 131 countries have said they are exploring CBDCs. The Biden administration has also signaled that it’s supportive of a Federal Reserve-backed U.S. CBDC, a development that will be discussed further in a separate Tip Sheet.

A U.S. CBDC would pose a significant threat to individual liberty, because it would allow central planners to engineer society in accordance with their every objective, with little accountability or oversight. They pose a tremendous threat to privacy, freedom, limited government democratic institutions, and society at large, as outlined in separate Tip Sheets.

Although the creation of a CBDC would likely require an act of Congress, some policymakers and activists appear to be attempting to lay the groundwork for CBDCs at the state level, by offering amendments to the Uniform Commercial Code (UCC).

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