H.R. 4438: Power of the Mint Act

This bill, known as the Power of the Mint Act, aims to establish restrictions on the issuance of a central bank digital currency (CBDC) by the Federal Reserve and the Secretary of the Treasury. Here are the key components of the bill:

Prohibition on CBDC Issuance

The main provision of the bill states that:

• The Board of Governors of the Federal Reserve cannot issue a central bank digital currency unless Congress authorizes it.
• The Secretary of the Treasury is also prohibited from directing the Federal Reserve to issue a central bank digital currency without Congressional approval.

Definition of Central Bank Digital Currency

The bill defines a central bank digital currency as:

• A form of digital money or monetary value.
• Denominated in the national unit of account (the U.S. dollar).
• A direct liability of the Federal Reserve.

Constitutional Basis

The bill references Article I, Section 8 of the U.S. Constitution, which states that only Congress has the authority to coin money and regulate its value. This is part of the justification for requiring Congressional authorization before a CBDC can be issued.

Historical Context

The bill notes that the Federal Reserve Act of 1913 established the Federal Reserve banks as fiscal agents for the United States, further connecting the authority granted to the Federal Reserve regarding monetary policy to Congressional oversight.

Overall Purpose

The purpose of this legislation is to ensure that the power to issue a central bank digital currency remains under the control of Congress, rather than being delegated to the Federal Reserve or the Treasury Department without explicit approval from lawmakers.

Relevant Companies

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