Roy Cooper, the governor of North Carolina, vetoed House Bill No. 690 that would have banned the state from receiving payments in U.S. Federal Reserve-issued central bank digital currency (CBDC) on June 5. The bill would have also restricted the state from participating in any CBDC testing by the Federal Reserve.

In a statement, Cooper noted that efforts are underway at the federal level to ensure that any CBDC has appropriate standards and safeguards for consumers. Vetoing the bill leaves the door open for those who may want to conduct transactions using CBDC, he added.

Cooper emphasized that North Carolina should “wait to see” how CBDCs work before making a final decision. He criticized the bill as premature, vague, and reactionary, stating, “This legislation is premature, vague, and reactionary and proposes an end result on important monetary decisions that haven’t even been made yet.”

Cooper also highlighted the need for more funding to tackle current cybersecurity threats rather than passing the now-vetoed bill.

In March, Federal Reserve Chair Jerome Powell stated at a Senate Banking Committee hearing that the US was “nowhere near recommending or let alone adopting a central bank digital currency in any form.”

Governor criticized for vetoing bill

Cooper faced criticism for vetoing the bill that secured a vast majority of votes in both the House of Representatives and the Senate. Dan Spuller, head of industry affairs at the Blockchain Association, expressed disappointment at the veto, stating, “By vetoing this bill, @NC_Governor missed an opportunity to send a clear message to the @FederalReserve that North Carolina stands united against the creation of a #CBDC.”

Spuller emphasized that policies related to digital assets should remain in the hands of the American people to reflect values of privacy, individual sovereignty, and free market competitiveness.

Since the bill received near-unanimous support in both chambers, legislators can easily overturn the veto with a three-fifths majority. Spuller insisted, “This veto must be overridden.”

It is important to note that North Carolina is not the only state with an anti-CBDC bill in progress. Florida recently passed legislation to ban the use of CBDCs amid concerns around state-controlled surveillance.