U.S. Lawmakers Embed CBDC Ban in Must-Pass Defense Bill to Sidestep Senate Resistance

The U.S. House of Representatives has embedded a provision banning the Federal Reserve from issuing a central bank digital currency (CBDC) into the 2026 fiscal year National Defense Authorization Act (NDAA) bill. The provision, which spans nearly 1,300 pages, was added to the House version of HR 3838 after a deal with conservative hardliners in July. The inclusion of this CBDC ban reflects growing political resistance to central bank-issued digital currencies, which several lawmakers argue pose threats to privacy and financial independence [1].

The provision explicitly prevents the Federal Reserve from studying, testing, or creating a digital currency or asset, with the exception of stablecoins that are “open, permissionless, and private.” It also prohibits the central bank from offering financial products or services directly to individuals [1]. This move aligns with broader legislative efforts by House Republicans, including the Anti-CBDC Surveillance State Act, which was narrowly passed by the House in July with a vote of 219-210. However, its prospects in the Senate remain uncertain [1].

The inclusion of the CBDC ban in the defense bill is not unprecedented. Lawmakers often add non-defense-related provisions to “must-pass” legislation to bypass potential roadblocks in separate votes. In this case, a group of Republican holdouts stalled floor debate on three major cryptocurrency bills for over nine hours in July until a CBDC ban was guaranteed. House Majority Leader Steve Scalise confirmed the decision to attach the provision to the NDAA, ensuring it would not face standalone legislative challenges [1].

The move has historical context. A similar bill, introduced by Representative Tom Emmer in early 2023 as the CBDC Anti-Surveillance State Act, failed to advance before the end of the last Congress. Emmer has since reintroduced the legislation, which now aligns with President Donald Trump’s executive order from January 2025, explicitly prohibiting CBDCs [1]. This suggests that the Republican-led Congress is seeking to solidify a legislative stance that mirrors the administration’s policy priorities.

The broader U.S. cryptocurrency policy landscape is also evolving rapidly. The House passed the CLARITY Act in July 2025, which seeks to provide regulatory clarity for digital assets. Meanwhile, the Senate is working on its own version of a crypto market structure bill, spearheaded by Senator Cynthia Lummis, which aims to balance innovation with accountability. The Senate’s bill is expected to build on the CLARITY Act and could provide a comprehensive regulatory framework for the sector. The Senate aims to finalize the bill by the end of 2025, with a focus on market structure and regulatory coordination between agencies like the SEC and CFTC [4].

The addition of the CBDC ban to the NDAA highlights the political sensitivity surrounding digital currency policy in the U.S. While proponents argue that CBDCs could enhance financial efficiency and monetary policy flexibility, critics warn of surveillance risks and the erosion of private financial autonomy. The debate reflects a broader ideological divide on the role of centralized institutions in the digital economy.

As the NDAA moves through the legislative process, its inclusion of the CBDC ban underscores the growing influence of anti-CBDC sentiment in U.S. policymaking. The bill’s final passage and subsequent approval by the Senate and President Trump will determine whether this provision becomes law. In the meantime, the ongoing legislative efforts to define the regulatory environment for digital assets suggest that the U.S. is seeking to position itself as a global leader in shaping the future of cryptocurrency and digital finance.

Source:

[1] US House adds CBDC ban to massive defense policy bill (https://cointelegraph.com/news/us-house-adds-cbdc-ban-defense-policy-bill)

[2] Crypto Week Was More than the GENIUS Act (https://www.law.com/newyorklawjournal/2025/08/20/crypto-week-was-more-than-the-genius-act-what-the-clarity-act-and-anti-cbdc-surveillance-state-act-mean-for-the-future-of-digital-assets/)

[3] Finance & Economics | CLS Blue Sky Blog - Columbia University (https://clsbluesky.law.columbia.edu/category/finance-economics/)

[4] Senator Lummis Vows to Deliver Crypto Market Structure Bill (https://coincentral.com/senator-cynthia-lummis-vows-to-deliver-crypto-market-structure-bill-to-donald-trump-before-2026/)