Scott Bessent, President-elect Donald Trump’s nominee for Treasury secretary, testified before the Senate Finance Committee on Jan. 16. He strongly opposed the introduction of a U.S. central bank digital currency (CBDC), stating there was no justification for one. Bessent argued that countries typically adopt CBDCs due to limited investment opportunities, which the U.S. does not face, given its strong financial markets.
Republican Senator Marsha Blackburn raised the issue by referencing China’s digital yuan launched during the 2022 Olympics. Bessent reiterated Trump’s campaign stance that no CBDC would be introduced during his administration, diverging from President Joe Biden’s 2022 executive order directing research into the concept. Advocates of CBDCs argue they could improve financial inclusion, but critics, particularly Republicans, warn of risks such as government surveillance and privacy threats.
Legislative efforts to block CBDCs are already underway. In May, the House of Representatives passed the CBDC Anti-Surveillance State Act to prevent the Federal Reserve from issuing a digital currency. The Senate received the bill in June, but its progress remains uncertain, particularly with Republicans now controlling the chamber.
Bessent, who previously worked as a partner at Soros Fund Management and donated to Trump’s campaign, is a known cryptocurrency supporter. In a prior Fox Business interview, he expressed enthusiasm for Trump’s embrace of digital assets. Crypto advocacy groups, including the Cedar Innovation Foundation, have endorsed his nomination, viewing his stance as favorable to innovation in the digital finance space.
Although his hearing focused more on tax policy, Bessent emphasized the need for a modern regulatory approach to digital assets. He outlined a strategy to address financial crimes like terrorist financing in the context of digital currencies, calling for a forward-looking regulatory framework that fosters innovation while ensuring security.
Over 130 nations globally are exploring or implementing CBDCs, with China’s digital yuan leading the way. Bessent argued these efforts often stem from necessity rather than strategic choice, asserting the U.S. does not share this urgency. Federal Reserve Chair Jerome Powell has indicated that any U.S. CBDC would require congressional approval, reflecting a cautious stance within the government.
Bessent’s ties to the crypto industry include past investments in a Bitcoin exchange-traded fund (ETF), which he divested after his nomination. While his confirmation is still pending, Bessent’s remarks signal his intent to shape financial policy to prioritize innovation, security, and a commitment to the private sector’s role in the digital economy.