Marco Rubio, Tom Cotton and Mike Braun, Republican senators, introduced legislation that focused on the Chinese digital currency. The lawmakers oppose the financial product and believe that it should be prohibited on American soil.
China’s CBDC Should Be Away from the USA
The e-CNY – a centralized digital money issued by the People’s Republic of China – has stirred the waters between two of the most powerful economies in the world. Marsha Blackburn, Roger Wicker and Cynthia Lummis, US politicians, advised American athletes to not use the product at the 2022 Beijing Winter Olympics. They cited espionage concerns.
The Foreign Ministry of China responded quickly, asking their US counterparts to “stop making problems” with the digital yuan. Zhao Lijian, a spokesperson for the Ministry, claimed that America doesn’t know what digital currency is.
Recent statements by Marco Rubio, Tom Cotton, Mike Braun and Tom Cotton reaffirmed the US’s largely negative position on the monetary products. A draft bill was introduced by them to limit the use of China’s CBDC within American app stores. Before the legislation can go live, it must be approved by the Senate, House and President Biden.
Senators explained that “app store” refers to a “publicly accessible website, software application or other electronic service that distributes third-party applications to users of a computer or mobile device or any other general-purpose computing devices.”
Cotton says the urgent move is necessary because China could “control and spy on” anyone using its digital currency.
He said, “We cannot give China that chance. The United States should reject China’s attempt to undermine its economy at its lowest level.”
Senator Rubio also spoke on the draft legislation:
It is absurd to tie ourselves to the digital currency a genocidal regime that has hated us and wants us to be replaced on the global stage. This is a serious financial and surveillance risk the United States cannot afford.”
Richard Turrin, a CNBC Financial Technology Consultant, stated earlier this year that the USD’s dominance could be challenged by the digital yuan in the next ten-years. He believes that the e-CNY could replace its rival in international trade settlements.
He believes that the US should be able to catch up with China and launch trials for a digital currency. In this way, many countries will be less dependent upon the greenback over the coming years.
“What you will see in the future are a rollback, which is a risk management exercise that attempts to slowly but surely reduce our dependence on the dollar from 100% to 80% or 85%.”
Marla Brooks – Financial Analysis
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