Trump Delays Housing Bill Signing Over Voting Legislation, Leaving CBDC Ban on Hold
The signing of a significant housing bill that will include a one-time ban of the use of a Central Bank Digital Currency (CBDC) has been postponed by U.S. President Donald Trump, which means that the approval of this legislation — which has been approved by both houses of Congress — may now take longer.
The 21st Century ROAD to Housing Act was approved by the U.S. Senate and House of Representatives; therefore, it was anticipated to become law on Wednesday. Nevertheless, President Trump announced via a Truth Social post that the signing would be postponed until Congress approves the SAVE America Act, which is a Republican-supported voting bill.
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While most of the provisions of the housing legislation focus on improving the accessibility of affordable housing, it also contains a provision regarding cryptocurrencies. This provision prohibits the US Federal Reserve from developing and/or utilizing a CBDC until December 31, 2030.
The legislation also provides an exception for some dollar-denominated stablecoins. Specifically, stablecoins that are open, permissionless, and private can continue to operate in the United States.
Source: Donald Trump
TRUMP PUTS HOUSING BILL ON HOLD
Trump stated that he would not sign the housing bill into law until "we have passed the vitally important SAVE America Act." The Save America Act will require all people who want to register to vote to show proof of their United States citizenship at the time they are registering. Those who support the act believe that requiring people to show proof of their U.S. citizenship is necessary to help maintain election integrity. Critics of the act state that making voters show proof of their citizenship will make it more difficult for qualified U.S. citizens to cast their ballots.
In addition to announcing that he would not sign the housing bill, Trump stated in March that he would also refuse to sign additional legislation until the Save America Act was enacted. Lawmakers were surprised by Trump's announcement regarding the housing bill because both chambers of Congress had strongly supported the bill. The Senate passed the housing bill with an 85 to 5 vote on Monday and the House approved the bill on Tuesday.
CBDC BAN INCLUDED IN HOUSING LEGISLATION
One of the areas of the housing bill that has received significant attention within the cryptocurrency industry is the CBDC (central bank digital currency) provision. This provision prohibits the Federal Reserve from creating or issuing a CBDC (or any digital asset that is similar) through 2030. Supporters of CBDCs claim that these types of currencies can help make payments more efficient; however, critics believe that they can create concerns about privacy and government surveillance. The bill’s exception for certain stablecoins is important because stablecoins now represent a large portion of the crypto market and digital payment system. Most stablecoins differ from CBDCs in that they are created by private organizations and are intended to mirror the value of traditional forms of currency (e.g., U.S. dollars).
BIPARTISAN SUPPORT FACES POLITICAL DELAY
The housing bill was supported by Democrats and Republicans prior to President Trump announcing he would veto it. Republican Chairman of the Senate Banking Committee, Sen. Tim Scott, voted in favor of the bill. Sen. Elizabeth Warren (D-Mass.), who co-sponsored the bill, has stated that she is pleased with its passage. “I don’t think I’ve said that very often lately,” Warren said, "but Congress did pass something that was good." The delay means the bill's provisions regarding housing reform and CBDC will wait on a larger battle regarding voting rights.
COULD CRYPTO MARKET STRUCTURE BILLS ALSO BE AFFECTED?
President Trump's recent actions have created an issue regarding the possibility of additional crypto-related legislation being delayed. The U.S. Senate continues to consider the Digital Asset Market Clarity Act (also referred to as the CLARITY Act), which would establish parameters for U.S. financial regulators to supervise digital assets, and potentially alter the current structure of America's crypto marketplace. It was reported in May that President Trump indicated a desire to create a "future-proof digital asset market structure," seemingly referencing the CLARITY Act.
Nevertheless, President Trump's latest position implies that further legislative efforts may be delayed until after passage of the SAVE America Act. Should President Trump choose to veto a piece of legislation; Congress retains the ability to override that veto through a two-thirds vote in each chamber of Congress (the House and Senate). At present time, this delay has placed greater uncertainty around both the CBDC prohibition and the broader crypto policy discussion.