Nearly half of Americans have not formed an opinion on the creation of a central bank digital currency, according to a recent study from the libertarian think tank Cato Institute.
Only 16 percent of Americans support CBDC creation, while 34 percent oppose it, according to the report. Twenty-eight percent reported being unfamiliar with the concept.
Those who were most familiar with CBDCs showed the most support for adopting one. Fifty-eight percent who are “very” or “extremely familiar” with the concept support it, while it is only supported by only 24 percent of those who are “somewhat familiar.” Partisan differences were evident as 84 percent of Democrats most familiar with CBDCs support implementation while only 32 percent of Republicans do so.
Support for the Federal Reserve correlated with support for a CBDC: 52 percent of those with a “very favorable” view of the Fed support adopting a CBDC. That number dropped to 26 percent among those who are “somewhat favorable” to the agency. “Once benefits and risks are considered, both Democrats and Republicans are wary of a CBDC,” the Cato Institute stated.
Top Congressional Democrats support a CBDC. Rep. Steven Lynch (D-Mass.), chair of the House Financial Services Committee’s Task Force on Financial Technology, introduced a bill last year that would allow the U.S. Treasury to issue a digital version of the bill. “CBDCs have the potential to harness the potential of cryptocurrencies while providing the security and stability of the U.S. dollar backed by the full faith and credit of the federal government,” said then-House Financial Services Committee Chair Maxine Waters last year.
The Biden administration has expressed support for a CBDC while saying more research is needed into the plan. In March, the Office of Financial Research found that a digital currency could improve household welfare while increasing the chance of a banking crisis amid a fall in deposit spreads. The Fed has announced that it will not issue a CBDC “without clear support from the executive branch and from Congress, ideally in the form of a specific authorizing law.”
Bills banning the issuance of a CBDC have been introduced this year by House Minority Whip Tom Emmer and Sen. Ted Cruz (R-Texas). “Allowing the government to centralize Americans’ financial information and increase surveillance of Americans’ financial activity is simply a bad idea,” added Sen. Mike Braun (R-Ind.), a cosponsor of Cruz’s bill. “The federal government should not have even more control over your own money.”