The Fed Wanted a Digital Dollar, So Congress Slid a 2030 Timeout Into a Housing Bill 🏠

The US Senate voted 85-5 on Monday to pass the 21st Century Road to Housing Act, sweeping housing legislation that also freezes any Federal Reserve effort to create a central bank digital currency until 2030. The bill now heads to the House, where a deal struck last week between House and Senate leaders is expected to deliver swift passage before it reaches the president's desk. The Senate first attached the CBDC ban in March, when it passed an earlier version 89-10.

The provision bars the Fed from issuing a central bank digital currency, directly or indirectly through any financial institution or other intermediary, or from creating "any digital asset that is substantially similar to a central bank digital currency." Even after the 2030 expiration, the central bank would still need explicit congressional authorization to move forward. A carve-out protects private stablecoins, defined in the bill as any "dollar-denominated currency that is open, permissionless, and private," leaving issuers such as Circle and Tether, now operating under last year's GENIUS Act, untouched. Republicans have spent years pushing to ban a US digital dollar, framing it as a financial-surveillance tool, and the language was added to the housing package as a political sweetener to lock in House GOP and administration support.

Banking Committee Chair Tim Scott (R-SC), who wrote the bill with Ranking Member Elizabeth Warren (D-MA), told the Senate floor that "housing prices are too darn high and housing supply is too low." Ahead of the vote, Warren said the result proved "that bipartisan legislation doesn't have to be the weakest, most milquetoast agreement" and called it the most significant housing package in three decades, while Senate Minority Leader Chuck Schumer said it "shows Americans how we should govern." Floor speeches focused on supply and corporate landlords rather than the digital-dollar provision traveling with the bill. The reconciled text, released Tuesday as H.R. 6644, was negotiated over months of wrangling with the House, and some House conservatives, including Rep. Anna Paulina Luna (R-FL), have argued the CBDC freeze should be permanent rather than temporary.

There is no active federal program to build a CBDC. The Fed never moved past the research stage, and both Chair Kevin Warsh and President Donald Trump have publicly opposed a digital dollar, with Trump signing a January 2025 executive order directing his administration not to pursue one. While Washington hits pause, other jurisdictions are advancing their own digital-currency work: Reuters reported on June 16 that China signed up 26 financial institutions to its digital yuan, or e-CNY, cross-border payment platform, and the Atlantic Council counts three countries with officially launched CBDCs, 41 in the pilot phase, 33 in development and 40 still in research.