North Carolina Governor Vetoes Bill Banning CBDC

Key Takeaways

• He described the legislation as “premature, vague, and reactionary,”
• The governor said that the legislature should focus on immediate issues such as providing more funding for cybersecurity threats.

North Carolina Governor Roy Cooper has vetoed House Bill 690, which aimed to ban the state from implementing a Federal Reserve-issued central bank digital currency (CBDC). The veto comes despite overwhelming support for the bill in both the state’s House and Senate.

The House approved the bill with a 109-4 vote on June 26, followed by a 39-5 vote in the Senate on June 25. The near-unanimous votes in both chambers suggest that North Carolina legislators could potentially override the governor’s veto with a three-fifths majority.

Governor Cooper explained his decision in a veto message, stating, “Efforts are being made at the federal level to ensure standards and safeguards are in place to protect consumers, investors, and businesses that may want to make monetary transactions in digital assets, and North Carolina should wait to see how they work before taking action.”

He described the legislation as “premature, vague, and reactionary,” adding that the legislature should focus on immediate issues such as providing more funding for cybersecurity threats.

Critics of the veto argue that it does not reflect the desires of North Carolinians. Mitchell Askew, head analyst at Blockware Solutions and a North Carolina native, told Cointelegraph, “The veto from Governor Cooper was not representative of the desires of North Carolinians.” He added, “He vetoed only because his opponent Mark Robinson is in favor of the bill. It’s clear who the pro-Bitcoin and pro-freedom candidate is here.”

Similarly, Dan Spuller, head of industry affairs at the Blockchain Association, lamented the missed opportunity to oppose a CBDC. “[Digital asset] policy must remain in the hands of the American people, ensuring that any development of digital currency reflects our values of privacy, individual sovereignty, and free market competitiveness,” Spuller said.

Governor Cooper’s veto comes amidst broader national discussions on the implementation of a CBDC. Federal Reserve Chair Jerome Powell, during a Senate Banking Committee hearing in March, stated that the U.S. was “nowhere near recommending or let alone adopting a central bank digital currency in any form.”

The latest development comes amid the US State of Louisiana passing a landmark pro-bitcoin bill to protect access to Bitcoin while banning CBDCs.

Last month, Oklahoma also passed a bill guaranteeing the right to self-custody, allowing individuals to securely hold their digital assets. Under the provisions of the bill, bitcoin and other digital currencies can be used for transactions without additional taxes, aligning digital assets with traditional legal tender regarding tax treatment.