Quick Insights

  • The US House voted 358-32 on Tuesday to pass the 21st Century ROAD to Housing Act, which includes a ban on the Federal Reserve issuing a central bank digital currency until December 31, 2030. Trump is expected to sign it into law Wednesday.
  • The ban covers any digital asset "substantially similar" to a CBDC issued directly or indirectly through a financial institution, but explicitly carves out private, permissionless, dollar-denominated stablecoins.
  • The legislation follows a 85-5 Senate vote on Monday and codifies into law the stance Trump set by executive order in January 2025, formally closing the door on a government digital dollar for at least four years.

The US Federal Reserve is on the verge of being legally prohibited from issuing a central bank digital currency after the House voted 358-32 on Tuesday to pass the 21st Century ROAD to Housing Act, a sweeping housing affordability bill whose final section bans a digital dollar until the end of 2030. The Senate cleared the same bill 85-5 on Monday. It now heads to President Trump, who is expected to sign it into law on Wednesday.

The CBDC provision, contained in Title XI, Section 1101 of the bill, states that the Fed may not, "directly or indirectly, issue or create a central bank digital currency or any digital asset that is substantially similar to a central bank digital currency." The clause expires December 31, 2030, at which point the Fed would need explicit congressional authorisation to pursue any digital dollar project. The bill carves out private stablecoins, exempting "dollar-denominated currency that is open, permissionless, and private," leaving issuers operating under last year's GENIUS Act stablecoin framework untouched.

Republicans Used a Must-Pass Housing Bill to Secure a CBDC Ban They Have Pursued for Years

The CBDC ban revives language from the Anti-CBDC Surveillance State Act, introduced by Representative Tom Emmer in June 2025 and passed by the House in July, but never taken up by the Senate. Republican lawmakers inserted it into the housing package to guarantee Senate consideration, attaching it to a broadly popular bipartisan bill backed by Senate Banking Committee Chair Tim Scott and ranking member Elizabeth Warren. That strategy worked: the Senate passed the combined bill 85-5.

The provision also codifies a position the White House had already taken. Trump signed an executive order in January 2025 prohibiting his administration from pursuing a CBDC, calling it a threat to financial privacy. Treasury Secretary Scott Bessent reiterated in May that a US digital dollar remains "off the table." The congressional ban converts that executive stance into statute, though some House conservatives have argued the freeze should be permanent rather than temporary.

What the CBDC Ban Does and Does Not Do
  • Prohibits the Fed from issuing or creating a CBDC or any substantially similar digital asset, directly or indirectly, until December 31, 2030
  • Explicitly exempts private, open, permissionless, dollar-denominated stablecoins from the ban
  • After 2030, the Fed would need explicit congressional approval to pursue any CBDC project
  • Does not affect research or academic study of CBDC design — the Fed never moved past that stage anyway

While the US formalises its retreat from a government digital dollar, the rest of the world is heading in the opposite direction. The European Central Bank is preparing a digital euro with a pilot expected in 2027 and a full launch targeted for 2029. China expanded its digital yuan cross-border platform by adding 26 financial institutions this month. For crypto markets, the stablecoin carve-out is the more immediately significant clause: it removes the prospect of a Fed-issued competitor to private stablecoins for at least four years, giving Circle, Tether and other regulated issuers a clear lane. With the housing bill off the congressional agenda, attention now shifts to the CLARITY Act, the crypto market structure bill that Galaxy Digital currently gives a 60% chance of passing the Senate before year end.

Disclaimer: Nakamoto Daily provides information for educational and entertainment purposes only. Nothing published here constitutes financial, investment, or trading advice. Readers should conduct their own research and consult a qualified financial adviser before making any investment decisions.