North Carolina’s lawmakers have overturned Governor Roy Cooper’s veto on a bill that would have prevented the state from implementing a central bank digital currency (CBDC).

On Sept. 9, the Republican-controlled Senate approved House Bill 690 with a 27–17 vote, surpassing the 60% threshold needed to override the governor’s rejection. This effectively prevents North Carolina from accepting payments in a CBDC and participating in the Federal Reserve’s CBDC trials.

Governor Cooper initially vetoed the bill in July, arguing it lacked clarity and was a reactionary measure. He emphasized that the bill did not address immediate threats and urged lawmakers to focus on cybersecurity-related budget matters.

However, Dan Spuller, head of industry affairs at the Blockchain Association, criticized the veto, calling it a missed opportunity to take a firm stand against CBDCs. He added:

“Thankfully, [North Carolina lawmakers] have shown true leadership by ensuring that DigitalAssets policy remains in the hands of the American people, assuring that any development of digital currency upholds our values of privacy, individual sovereignty, and free market competitiveness.”

CBDCs are digital versions of government-issued currencies built on blockchain technology to facilitate fiat currency transactions.

The Atlantic Council’s CBDC tracker shows that these currencies are gaining momentum worldwide, with countries representing 98% of global GDP exploring their implementation.

Notably, financial organizations like the International Monetary Fund (IMF) have argued that the assets could advance economic inclusion and lower the cost of financial services. However, the IMF also warned that the currency could also affect the financial stability of the issuing country.

Despite their global popularity, CBDCs are a divisive issue in the US. Democrats, like Senator Elizabeth Warren, advocate for their use, while Republicans, such as former President Donald Trump, oppose them.

Meanwhile, the Federal Reserve remains undecided about launching a CBDC. The regulator has noted that any such decision would require legal authorization.