Texas Lawmakers Propose Gold-backed Digital Currency

On the same day, two Texas lawmakers, Senator Bryan Hughes and Representative Mark Dorazio, proposed identical bills for introducing a digital currency backed by physical gold for the Texas state, despite multiple United States lawmakers objectively against the idea of introducing a central bank digital currency (CBDC) in the nation.

The bills stated that “each unit of the digital currency issued represents a particular fraction of a troy ounce of gold held in trust”, just like the old days. According to the bill, once an individual purchases a certain amount of digital currency, the comptroller would allocate these funds towards buying an equivalent amount of gold.

Next, the purchaser would receive digital currency equivalent to that of the gold purchased by the comptroller. The bill states that the trustee “shall maintain enough gold to provide for the redemption in gold of all units of the digital currency that have been issued and are not yet redeemed for money or gold”.

Such move may strengthen the case for CBDCs in the United States, yet, some lawmakers have highlighted the concerns of circulating a nationally-accredited digital currency. Republican Senator Ted Cruz on March 21st highlighted the importance of the United States protecting “financial privacy, maintains the dollar’s dominance and cultivates innovation.”

Sources:

https://cointelegraph.com/news/texas-lawmakers-propose-a-gold-backed-state-digital-currency

https://capitol.texas.gov/tlodocs/88R/billtext/html/SB02334I.htm

https://capitol.texas.gov/tlodocs/88R/billtext/html/HB04903I.htm