Executive order prohibiting central bank digital currency

January 23, 2025

Level

Procedural Bypass

Founders' Principles Violated

Madison

Checks & balances bypassed. Executive action without Congressional authority.

Hamilton

Executive power exceeded constitutional limits.

Washington

Personal ambition overriding institutional stability.

Guardrails Violated

Congressional Authority

Congressional authority and oversight bypassed.

Separation of Powers

Separation of powers and constitutional balance between branches violated.

Independent Agencies

Independence of regulatory agencies from political interference undermined.

Trigger

President Trump signed Executive Order 14178 on January 23, 2025, prohibiting the creation or promotion of a central bank digital currency (CBDC) and revoking previous frameworks on digital assets. The order established a task force for regulation of digital assets.

Action Taken

Signed Executive Order 14178 on January 23, 2025, prohibiting the creation or promotion of a central bank digital currency (CBDC) and revoking previous frameworks on digital assets. The order established a task force for regulation of digital assets. Critics argued the order bypassed normal regulatory processes and Congressional oversight. The order created uncertainty in digital asset markets and raised questions about Federal Reserve authority.

In His Own Words

"A CBDC would be a tool of government control."

"We will not allow a digital dollar."

"Digital currencies must remain private and decentralized."

What's Wrong

Executive order prohibiting CBDC and revoking previous frameworks bypasses normal regulatory processes and Congressional oversight. Digital currency policy typically requires Congressional authorization and regulatory review. The order created uncertainty in digital asset markets and raised questions about Federal Reserve authority.

Impact

Constitutional: Questions about Federal Reserve authority and monetary policy independence. Legal: Order bypasses normal regulatory processes. Economic: Created uncertainty in digital asset markets. Operational: Established task force for regulation, but order bypassed normal processes.

Sources & Full Details

Primary Sources

https://en.wikipedia.org/wiki/Executive_Order_14178

Background

Executive Order 14178 was signed on January 23, 2025, prohibiting the creation or promotion of a central bank digital currency (CBDC) and revoking previous frameworks on digital assets. The order established a task force for regulation. Critics argued the order bypassed normal regulatory processes. The order created uncertainty in digital asset markets.

Why Level 2?

Procedural bypass: Executive order prohibiting CBDC bypasses normal regulatory processes and Congressional oversight. Measurable harm to regulatory certainty and Federal Reserve authority. Order created uncertainty in digital asset markets.