US Democrats Label Cryptocurrency a Scam Push for CBDCs

US Democratic lawmakers have taken a strong stance against cryptocurrency, labeling it as a "scam" during a recent press conference. The lawmakers advocated for the development and implementation of a central bank digital currency (CBDC) as an alternative to the volatile and risky nature of cryptocurrencies.

Representative Maxine Waters criticized the CBDC Anti-Surveillance State Act, a bill aimed at prohibiting the creation of a government-controlled digital dollar, calling it the "anti-innovation act." She argued that both the anti-CBDC bill and the GENIUS stablecoin bill pose threats to national security.

Representative Stephen Lynch, who also participated in the press event, expressed his views on cryptocurrency, stating that it lacks any legitimate use case. He emphasized that the only notable use of cryptocurrency has been in facilitating illegal activities, such as ransomware heists that have targeted US businesses. Lynch described cryptocurrency as a highly risky and volatile product that has no place in a well-regulated financial system, asserting that the entire industry is a scam.

In contrast to the US, other countries are progressing with the digitization of their fiat currencies. The Reserve Bank of India announced plans to expand its CBDC test trials in May, focusing on novel use cases for its digital rupee. Australia’s central bank also revealed plans to test wholesale CBDCs in a closed experiment with select institutions. However, the Bank of England Governor Andrew Bailey expressed concerns about issuing a CBDC, arguing that it could destabilize the banking system and suggesting that the bank should focus on tokenizing deposits instead.

Despite the push for CBDCs, there is significant opposition and uncertainty among the public. Most Americans either oppose the adoption of a CBDC or are currently undecided about its implementation. This sentiment reflects the broader debate surrounding the role of digital currencies in the global financial landscape.

In summary, US Democratic lawmakers have taken a firm stance against cryptocurrency, advocating for CBDCs as a more stable and secure alternative. Representative Stephen Lynch's comments highlight the perceived risks and lack of legitimate use cases for cryptocurrency, while other countries continue to explore the digitization of their fiat currencies. The public's opposition and uncertainty about CBDCs add another layer of complexity to the ongoing debate about the future of digital currencies.