- Presidential hopefuls Robert F. Kennedy Jr. and Ron DeSantis are against the Federal Reserve’s FedNow payments system, claiming it could lead to a central bank digital currency.
- FedNow is a 24/7 instant payments system that aims to speed up transfers between financial institutions and businesses and provide a government-backed alternative to similar networks provided by the private sector.
Presidential hopefuls Robert F. Kennedy Jr. and Ron DeSantis are criticizing the Federal Reserve’s FedNow payments system, claiming that it could pave the way for a central bank digital currency (CBDC).
RFK Jr. describes CBDCs as the “ultimate mechanisms for social surveillance and control” and claims that cryptocurrencies like Bitcoin give the public an escape route from the bubble of profiteering and control.
The claim that FedNow is not the first step toward a CBDC would be more easily digestible were we not aware of the Biden administration’s steady barrage of hostile broadsides against cryptocurrencies.
Between 2008-22, the Fed partnered with a handful of big banks to print $10…
— Robert F. Kennedy Jr (@RobertKennedyJr) April 10, 2023
On the other hand, Governor DeSantis argues that “unaccountable institutions cannot impose a CBDC on Americans,” stating that it is constitutionally required that major changes in policy receive specific authorization from Congress.
It is not merely “ideal” that major changes in policy receive specific authorization from Congress; it is constitutionally required.
Unaccountable institutions cannot impose a CBDC on Americans. They will tell us that CBDC won’t be abused but we are wise enough to know better.… https://t.co/OqJ27Lym2L
— Ron DeSantis (@GovRonDeSantis) April 10, 2023
FedNow and CBDCs
FedNow is a 24/7 instant payments system that aims to speed up transfers between financial institutions and businesses while providing a government-backed alternative to similar networks provided by the private sector.
The Federal Reserve has played down the possibility of integrating the system with a CBDC, saying that no decision has been made to issue one and that it would not do so without clear support from Congress and the executive branch.
Despite this, RFK Jr. and Governor DeSantis remain critical of CBDCs, citing concerns over their potential use for surveillance and control over citizens.
Privacy and Surveillance
RFK Jr. and Governor DeSantis fear that CBDCs threaten privacy and autonomy, while others argue that their concerns are misplaced. According to former United States Treasury official Aaron Klein, financial institutions are already required to report transaction data under current anti-money laundering and terrorism financing laws, and a CBDC wouldn’t encroach on privacy any further. Klein emphasizes that FedNow is purely focused on speeding up current Fed payment rails and has nothing to do with CBDCs.
In conclusion, Presidential hopefuls Robert F. Kennedy Jr. and Ron DeSantis are criticizing the Federal Reserve’s FedNow payments system, claiming that it could pave the way for a central bank digital currency (CBDC).
However, the Federal Reserve has played down the possibility of integrating the system with a CBDC, stating that no decision has been made to issue one and that it would not do so without clear support from Congress and the executive branch. RFK Jr. and Governor DeSantis fear that CBDCs threaten privacy and autonomy, while others argue that their concerns are misplaced.
FedNow’s launch could potentially threaten the business model of Ripple and XRP. Ripple CEO Brad Garlinghouse has previously claimed that the company’s payment protocol, which utilizes XRP, is faster and more efficient than FedNow. However, the introduction of a government-backed alternative to private-sector payment networks could disrupt Ripple’s strategy.
#Ripple: Outside of the US nobody gives a sh*t about the SEC's stand about #XRP. pic.twitter.com/FsU6dluU7e
— ETHNews (@ETHNews_com) April 11, 2023
