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Federal Reserve digital dollar barred for four years under housing law
The ban, created within a bipartisan housing affordability bill, would prevent the Fed from issuing a CBDC intended to compete with private stablecoins.
CoinDesk reports that a bipartisan U.S. housing affordability bill is set to become law at midnight, along with an unrelated provision that bars the Federal Reserve for four years from issuing a central bank digital currency, described as a potential digital dollar.
The restriction blocks the Fed from issuing a U.S. CBDC that could compete with private-sector stablecoins, even though the article notes there was not an ongoing serious push at the central bank to pursue such an effort.
The law is tied to President Donald Trump’s refusal to sign the bill, though CoinDesk says the measure still advances under constitutional rules because a congressionally approved bill becomes law after a 10-day period whether or not the president signs it. Trump said he would not sign the housing bill in a post on Truth Social, citing protest over the Senate.
CoinDesk adds that the CBDC ban is set to run until the end of 2030, while the Fed’s leadership, including before Kevin Warsh became chair, had indicated a digital dollar effort would require backing from the White House and Congress.