The Civic Node

Anti-CBDC Surveillance State Act

6 min read

Definition

The Anti-CBDC Surveillance State Act (H.R. 1919, 119th Congress) is the third bill of Crypto Week (July 14–18, 2025). Sponsored by House Majority Whip Tom Emmer (R-MN), it prohibits the Federal Reserve from issuing a retail Central Bank Digital Currency or testing one through intermediated arrangements. It passed the House on July 17, 2025 by a 219–210 vote — the narrowest margin of the three Crypto Week bills, and the most partisan. The White House issued a Statement of Administration Policy “strongly supporting” passage and codifies Trump’s January 2025 executive order banning CBDC development.

Why It Matters

The Act is unusual in legislative history: it bans something the Federal Reserve has explicitly said it isn’t doing. As Congress Advances Crypto Bills — StratNews Global noted at the time, “the Federal Reserve has not indicated a desire to develop a CBDC.” This makes the Anti-CBDC Act primarily a symbolic and preemptive bill — its purpose is to foreclose a future the Fed wasn’t pursuing, in service of a coalition (libertarian-right + crypto industry) that views any retail CBDC as the leading edge of financial surveillance.

The bill reflects three converging concerns:

  1. Surveillance: A Fed-issued retail CBDC could in principle expose every transaction to government visibility — the surveillance state risk.
  2. Account freezes: Emmer cites Canada’s 2022 freezing of trucker convoy accounts and China’s e-CNY pilot as cautionary models.
  3. Disintermediation: A retail CBDC would compete with commercial bank deposits, potentially destabilizing the dual-banking architecture the GENIUS Act preserves.

Key Provisions

  • Retail CBDC prohibition: Federal Reserve banks may not “offer products or services” directly to individuals.
  • Indirect prohibition: Bans intermediated arrangements where commercial banks would distribute Fed-issued digital currency to consumers.
  • Wholesale carve-out: Does NOT prohibit wholesale CBDC for interbank settlement (which the Fed has researched).
  • Codification of Trump EO: Locks in the January 23, 2025 Trump EO on Digital Financial Technology — White House anti-CBDC directive at the statutory level, making rescission harder for future administrations.

Vote and Politics

  • House passage: 219–210 (July 17, 2025) — the narrowest of the three Crypto Week bills.
  • Highly partisan: Republicans largely yes, Democrats largely no.
  • Senate status: Not taken up. The bill has no Senate companion advancing through committee as of late 2025. The 2025 government shutdown further pushed any consideration into 2026.

The “Solving a Problem That Doesn’t Exist” Critique

This is the central analytical objection from the policy center-left and from the contrarian framing the wiki has tried to surface:

  • The Fed has not pursued a retail CBDC. Powell testified in 2022 that any CBDC would require explicit congressional authorization — the Fed was not going to do it unilaterally.
  • The Act therefore prevents an action no agency was preparing to take.
  • Defenders respond that this is exactly the right time to lock the door — before a future administration with different priorities tries.

The wiki holds both framings: the Act is real legislation with real effects on future policy space, AND it is politically performative in the sense that no current Fed action is being constrained.

Connections to Other Crypto Week Bills

  • GENIUS Act: protects commercial stablecoin issuers (including USD1, Tether, Circle) from competition by a Fed retail CBDC. Together, GENIUS + Anti-CBDC create a regulatory architecture that requires dollar-pegged digital money to flow through private issuers, not the Fed.
  • CLARITY Act: market structure for tokens that aren’t stablecoins. Anti-CBDC is the negative space — what the public sector cannot do — bracketing the affirmative provisions of GENIUS and CLARITY.

The three bills are best understood as a single package: legalize and regulate private digital dollars; lock the public sector out of issuing them.

International Context

  • China e-CNY: The most-cited cautionary case. Operational since 2020; over 260M wallets; integration with social credit infrastructure. Emmer’s floor remarks invoke this directly.
  • EU digital euro: ECB has been studying since 2021; pilot decisions ongoing. The wholesale-vs-retail distinction is the same fault line.
  • UK digital pound: Bank of England in design phase; explicit privacy guarantees built in.
  • Canada: BoC researched but paused active CBDC work in 2024, citing low public demand. The Canadian trucker convoy account freezes (2022) are the most-cited surveillance example by U.S. critics.

The U.S. is the only G7 country that has legislatively prohibited its central bank from issuing retail CBDC. This is itself a notable monetary policy stance.

Tensions & Counterarguments

  • Performative critique: Bans something the Fed wasn’t doing.
  • Defensive framing: Codifies a policy stance against future administrations who might.
  • Wholesale CBDC carve-out: Suggests the bill is more about retail surveillance than CBDC technology per se. Wholesale settlement CBDC remains technically permitted.
  • Privacy infrastructure question: Banning retail CBDC doesn’t address the broader payments-surveillance question — most consumer payments already flow through private rails (Visa, Mastercard, Plaid, Zelle) that also expose data to corporate and government view. Anti-CBDC closes one door while leaving the larger surveillance architecture intact.
  • Disintermediation concern: Defenders correctly note that retail CBDC adoption would threaten commercial bank funding. This is a real systemic issue that the wholesale-only path addresses.

Key Sources

Open Questions

  • Does the Senate ever take this up, or does it die in 2026?
  • Does the wholesale-CBDC carve-out become contested as the Fed continues research on settlement applications?
  • If a future administration wants to revisit retail CBDC, what’s the legislative path to repeal — and would the GENIUS Act’s stablecoin architecture have so embedded private issuers by then that it’s moot?

Graph View

Backlinks