U.S. presidential candidate Robert F. Kennedy Jr. alleges that the FedNow real-time settlement system is a precursor to a central bank digital currency (CBDC) that suits the Biden administration’s anti-crypto agenda.
He warned that the FedNow instant payment system, due for release in July 2023, is the first step toward “financial slavery and political tyranny.”
Kennedy Argues That Like CBDCs, FedNow Will Erode Liberties
Kennedy, who filed candidacy papers on April 5, argues that, unlike a CBDC, Bitcoin insulates against government control. A CBDC, on the other hand, would empower the government to censor transactions.
He also points out alleged efforts by the Biden administration to stifle crypto businesses at least 15 times since early December 2022. Reports that the administration was using banking institutions to suppress crypto were first reported by venture capitalist Nic Carter, who coined the phrase “Operation Chokepoint 2.0.”
Several commentators have pointed out that the Fed technically announced the release of FedNow and not a CBDC. However, Kennedy agrees with former Coinbase executive Balaji Srinivasan that while the two systems differ technically, they present the same crackdown on American civil liberties.
Kennedy predicted the U.S. government would promote CBDCs under the guise of preventing further Covid-19 infections through physical money.
He cited Srinivasan’s views that FedNow remains a surveillance tool despite appearing innocuous. Although Fed claims that banks would use the FedNow system to settle transactions between themselves, Kennedy pointed out that earlier seizures of gold and Bitcoin in 1933 suggest that FedNow’s use would spread.
Kennedy, the nephew of former president John F. Kennedy Jr., is also a vocal opponent of government-mandated Covid-19 vaccines.
Fed Insists No Immediate CBDC Plans
Former Senate Banking Committee member Aaron Klein criticized Kennedy’s views by pointing out that banks already need to collect and report certain transaction data to combat money laundering and counter-terrorism financing.
Josh Lipsky of the Atlantic Council, which hosts a CBDC tracker on its website, said that laws protecting users of credit cards would necessarily apply to a CBDC. Entities requiring bank and credit card transaction information could only do so via a court order.
Responding to Kennedy’s tweet, the Federal Reserve said that FedNow is distinct from a CBDC. The latter is still a subject of study.
Florida governor Ron DeSantis, who recently filed a bill to ban foreign and national CBDCs in the state, said that Congress must approve any attempt by “unaccountable institutions” to impose a CBDC on American citizens.
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