Missouri Senate introduces bill to disqualify CBDCs as legal tender

The Missouri Senate launched SB 194 on December 1, which proposed banning central financial institution digital currencies (CBDCs) as authorized tender throughout the state. The invoice seeks to ban public entities from accepting or utilizing CBDCs and amends the definition of “cash” beneath the Uniform Industrial Code to exclude these digital currencies.

SB 194, sponsored by Senator Brattin, outlines a number of provisions that impression Missouri’s monetary coverage, together with the requirement for the state treasury to keep up gold and silver reserves equal to a minimum of 1% of all state funds. Moreover, it additionally reduces the tax legal responsibility for gold and silver

“exempts from state earnings tax that portion of the capital achieve on the sale or change of gold and silver that’s in any other case included within the taxpayer’s federal adjusted gross earnings.”

Along with addressing treasured metals, the invoice explicitly prohibits public entities from collaborating in any testing or pilot applications associated to CBDCs carried out by the Federal Reserve or different federal businesses. This place displays rising considerations amongst some state lawmakers concerning the implications of CBDCs for monetary privateness, financial coverage, and state sovereignty.

The change to the definition of “cash” within the Uniform Industrial Code to exclude CBDCs is a notable authorized shift. This variation might have important impacts on business transactions, contracts, and monetary devices inside Missouri, successfully limiting the authorized recognition and enforceability of CBDC-based transactions.

Earlier in 2024, the Missouri Legislature thought-about associated measures concerning digital currencies. Home Invoice 2780, launched in February, sought to stop public entities from accepting or utilizing CBDCs and handed the Home in April with substantial help. The Senate has additionally reviewed companion laws, comparable to SB 1352, indicating a continued legislative give attention to regulating digital currencies on the state stage.

Missouri’s legislative actions come amid broader nationwide and world discussions concerning the adoption and regulation of CBDCs. Whereas some view CBDCs as an evolution in digital cost methods with the potential to enhance effectivity and monetary inclusion, others specific considerations about centralized management, privateness points and the impression on conventional banking methods.

The introduction of SB 194 positions Missouri amongst states which might be actively exploring the position of government-issued digital currencies of their economies.