A notable trend in the United States involves the introduction of legislation at the state level aimed at redefining the legal status of central bank digital currencies (CBDCs). In a series of bills filed in states like Utah, South Carolina, South Dakota, and Tennessee, policymakers are seeking to exclude CBDCs from the traditional definition of money, thereby potentially introducing significant roadblocks to their acceptance and use within the country.
In Tennessee, State Senator Frank Niceley has proposed a bill that would amend the Tennessee Uniform Commercial Code (UCC) to explicitly state that “money does not include any central bank digital currency.” This move is in line with the state’s existing UCC, which defines money as an authorized medium of exchange.
Similarly, in Utah, Representative Tyler Clancy has introduced House Bill 164, which explicitly outlines that a CBDC is not specie legal tender and does not hold the status of legal tender within the state. The proposed bill aligns with Utah’s Specie Legal Tender Act and the state’s UCC.
South Carolina State Senator Shane Martin filed Senate Bill 861, which seeks to add language to the state’s UCC stating that “money does not include any central bank digital currency.” This proposed amendment reflects an effort to carve out a specific exclusion for CBDCs within the state’s legal framework.
South Dakota joins this legislative trend with Senate Bill 58, introduced at the request of the Department of Labor and Regulation. This bill introduces a definition of money that explicitly excludes central bank digital currency.
These state-level initiatives follow the precedent set in Florida, where Governor Ron DeSantis signed legislation placing restrictions on the use of CBDCs within the state. The Florida law not only prohibited the use of CBDCs issued by foreign governments but also urged other states to enact similar prohibitions using their commercial codes.
These legislative moves present a complex landscape for the potential recognition and acceptance of CBDCs within the United States. The outcomes of these state-level efforts will likely play a crucial role in shaping the regulatory environment surrounding CBDCs and their integration into the broader financial infrastructure. The intricate interplay between state-level regulations and federal considerations adds an additional layer of complexity to the evolving landscape of digital currencies in the country.
