Washington, D.C. —  Today, Congressman Tom Emmer (MN-06), the Ranking Republican on the House Financial Services Subcommittee on Oversight and Investigations, led a letter with Ranking Member Patrick McHenry (NC-10) to Susan Collins, President of the Federal Reserve Bank of Boston, about “Project Hamilton,” an initiative to research the development of a central bank digital currency (CBDC).

A central bank digital currency is a programmable digital currency issued from a federal reserve. If the CBDC is not crafted with the values of transparency in mind, the currency falls at risk to the financial privacy violations currently on display in China.

It has come to Congress’s attention that some firms participating in Project Hamilton intend to use government resources from the project to design a CBDC with the intent to then sell those products to commercial banks.

Emmer said, “Any U.S. CBDC must be open, permissionless, and private.”

“The more we learn about the Boston Fed’s work on Project Hamilton, the more we have become concerned with the lack of transparency, especially as it relates to their partnership with the private sector. The unfair advantage that some private companies could enjoy from this partnership and the failure to ensure the principles of privacy, sovereignty, and free markets should be concerning to every American,” Emmer concluded.

Specifically, the letter asks about Project Hamilton’s funding and engagement with the private sector as they seek to develop a CBDC. The letter also asks how the Fed plans to address concerns that many have regarding the dangers a CBDC could pose to financial privacy and financial freedom, which were the subject of over 65% of the letters in response to the Fed’s January 2022 report on CBDCs.

Emmer and McHenry were joined on the letter by House Financial Services Committee members Ann Wagner (MO-02), Ted Budd (NC-13), Bill Huizenga (MI-02), Andy Barr (KY-06), French Hill (AR-02), Anthony Gonzalez (OH-16), and Warren Davidson (OH-08).

Background

Project Hamilton is a collaboration between the Federal Reserve Bank of Boston and the Digital Currency Initiative at the Massachusetts Institute of Technology to research the potential development of a central bank digital currency (CBDC) in the United States.

Emmer has long expressed concern about the implementation of a U.S. CBDC. In January, Emmer introduced a bill to prohibit the Federal Reserve from issuing a CBDC directly to individuals. You can read more about that bill here.

You can read the letter in full here. 

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