Texas Lawmakers Propose A Plan for Gold – Backed State Digital Currency

April 10, 2023


Two Texas lawmakers have introduced identical bills for introducing a state–based digital currency backed by gold.  According to the proposed bill the trustee would have to hold a sufficient amount of gold in their reserve for all units of digital currency. However, there were certain objections from several US lawmakers against the introduction of Central Bank Digital Currency (CBDC).

Bill 2334 was introduced by Senator Bryan Hughes on March 10. On the other hand, Mark Dorazio introduced House Bill 4903 on the same day.  Both the bills state that a fractionally equivalent amount of gold in physical form shall back a proposed digital currency.

In the proposed bill, upon purchasing an amount of digital currency the comptroller uses the money to buy an equivalent amount of physical gold. One would receive digital currency equivalent to the amount of gold that the comptroller purchases. Each unit of digital currency is considered equal to the value of the appropriate portion of an ounce of gold during the transaction period.

Alongside, the trustee is also supposed to maintain enough gold to provide redemption in gold against digital currency which is not issued or redeemed for money or gold. Furthermore, the fee might also be established as per the necessary rate which would cover the cost of administering the gold-backed CBDCs.

While several states were opposing the bill, the Governor of Florida, Ron DeSantis stated in a press conference that CBDCs would grant more power to the government while providing a direct view of customer activities.  However, neither of the bills has been passed or presented for a vote.

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