Only 16% of Americans favour the government issuing central bank digital currency

The possibility of adopting central bank digital currencies (CBDCs) is being explored by countries worldwide, including the US. However, according to the Cato Institute 2023 CBDC National Survey, a mere 16% of Americans support the adoption of a CBDC.

While digital dollars through credit cards, debit cards, and other platforms are commonly used by Americans for transactions, these digital currencies are liabilities of private commercial banks like Bank of America or Chase Bank. In contrast, a CBDC would be a liability of the government's central bank, such as the Federal Reserve. This direct link between citizens and the government's central bank has raised concerns among Americans.

The survey found that twice as many Americans oppose (34%) the Federal Reserve offering a CBDC compared to those who favour it (16%). However, many Americans (49%) have not yet formed an opinion, likely due to the fact that only 28% of Americans are familiar with CBDCs, while 72% are not.

Support for CBDCs varies across demographic groups. Men are approximately twice as likely (22%) as women (11%) to support a CBDC. Black Americans are nearly three times as likely (32%) as white Americans (13%) to support a CBDC, surpassing the support among Hispanic Americans (20%). Younger Americans are approximately ten times more supportive of a CBDC than seniors, with 32% of those under 30 in favour, compared to 25% of 30–44-year-olds, 8% of 45-64 year-olds, and 3% of Americans over 65. While approximately half of all age groups lack sufficient information to support or oppose the adoption of a CBDC, around half of Americans over 55 oppose it.

Income levels do not significantly influence support for a CBDC. Among those earning less than USD 20,000 per year, 19% support a CBDC, while 21% of those earning over USD 100,000 per year support it.

The survey explored Americans' views on the costs and benefits associated with the adoption of a CBDC. Overwhelming majorities oppose a CBDC if it means that the government could control people's spending (74%), monitor their transactions (68%), abolish physical cash (68%), attract cyberattacks (65%), impose taxes on those who don't spend money during recessions (64%), or freeze digital bank accounts of political protesters (59%). Americans are marginally opposed (52%) if a CBDC could cause some people to stop using private banks, resulting in bank closures.

Some potential advantages of a CBDC received more support than opposition. Pluralities would support a CBDC if it reduced the risk of money laundering and fraud (42%) or ensured welfare payments were used for their intended purpose (40%).

Americans have mixed opinions regarding a CBDC's ability to enable instantaneous financial transactions (27% favour), provide equitable access to the banking system for the unbanked (33% favour), or assist the Federal Reserve in combating economic recessions (32% favour). In each scenario, approximately a quarter to a third of Americans have no opinion on CBDCs.

When it comes to a CBDC's attributes, Americans prioritise avoiding additional costs (33%) and securing privacy (32%). More secure digital payments (25%) and ease of use (24%) are also important. Attributes like instantaneous transactions (15%), offline usability (13%), international usability (12%), and smartphone usability (11%) are less crucial, with 37% stating that none of these attributes are important.

The most significant concerns regarding CBDCs include the potential for the government to control people's spending (66%) and monitor their transactions (63%). Medium priority concerns include government censorship (47%) and the abolition of cash (37%). Lower priority concerns include crowding out private banks (13%) and disrupting monetary policy (13%).

The adoption of a CBDC in the United States is a relatively new issue, leaving many Americans undecided. After learning about the potential costs and benefits, Americans appear cautious. Concerns about government surveillance and control over spending, as well as the impact on physical cash, have influenced their views. Some potential benefits, such as reducing money laundering and fraud and ensuring welfare benefits are used appropriately, receive a plurality of support. However, after weighing arguments for and against it, most Americans believe that the United States should not issue a CBDC. Americans generally express satisfaction with private banks and trust them more than the federal government to handle their money. Consequently, nearly 8 in 10 Americans state they are unlikely to use a CBDC even if it were issued. Although certain groups (Democrats, black Americans, younger people) are more supportive of a CBDC, majorities across the board oppose its adoption. Overall, a majority of Americans do not support the adoption of a CBDC, which government officials should consider before proceeding.

To find out more about the study you can check out this link.