South Dakota Senate Bill SCR603

South Dakota 2024 Regular Session

• Introduced: 1/25/24
• Refer: 1/25/24
• Engrossed: 2/8/24
• Enrolled: 2/12/24
• Enrolled: 2/14/24

Caption

Opposing the adoption and development of a central bank digital currency.

Impact

The resolution advocates for federal legislative action to prohibit the establishment of a CBDC in the United States. By expressing opposition to a CBDC, SCR603 aims to protect the existing framework of financial intermediation provided by commercial banks. The implications of this resolution would extend to how financial institutions operate and manage liquidity in the market, as the presence of a CBDC could threaten their central role in lending and financial services.

Summary

SCR603 is a resolution adopted by the South Dakota Legislature opposing the development and adoption of a central bank digital currency (CBDC). The resolution outlines concerns regarding the implications of a CBDC on the traditional banking and financial systems, emphasizing that it would fundamentally alter the relationship between consumers and the Federal Reserve. It argues that such a currency could undermine financial privacy for individuals and potentially lead to a decrease in credit availability as funds would move from commercial banks to the Federal Reserve, where they could not be reinvested into the economy.

Sentiment

The sentiment surrounding SCR603 appears to be overwhelmingly supportive among legislators, as evidenced by the unanimous vote in favor of the resolution with 69 votes for and none against. The resolution reflects a cautionary stance taken by the South Dakota Legislature regarding new financial technologies that could disrupt established economic practices. Legislators supporting the resolution expressed clear concerns about the potential risks associated with a centralized digital currency.

Contention

Notable points of contention addressed in SCR603 include the potential loss of individual financial privacy and the risk of exacerbating economic and liquidity crises. The resolution argues that the creation of a CBDC could endanger the long-standing economic principles underlying the United States' financial system and could lead to negative consequences for both consumers and banks. This highlights a broader debate on the balance between technological advancements in finance and the need to maintain consumer protections and financial stability.