ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature

First Regular Session

Senate: FIN DP 4-3-0-0 | 3rd Read 17-12-1-0-0

☐ Prop 105 (45 votes) ☐ Prop 108 (40 votes) ☐ Emergency (40 votes) ☐ Fiscal Note

SB 1095: central bank digital currency; ban

Sponsor: Senator Hoffman, LD 15

Committee on Commerce

Overview

Outlines prohibitions relating to the use of federally recognized central bank digital currency (CBDC).

History

According to the Federal Reserve, a CBDC is generally defined as a digital liability of a central bank that is widely available to the public. In the United States, Federal Reserve notes are the only type of central bank money available to the public. A CBDC would enable the public to make digital payments.

Arizona's Uniform Commercial Code regulates commercial and secured transactions in Arizona, including sales of goods, leases of personal property, negotiable instruments, bank deposits and collections, rights and obligations connected with fund transfers, letters of credit, investment securities and secured transactions. Under the Uniform Commercial Code, money is defined as a medium of exchange currently authorized or adopted by a domestic or foreign government, including a monetary unit of account established by an intergovernmental organization or by agreement between two or more countries (Title 47, A.R.S.).

Various statutes currently provide a definition of legal tender and includes specie as a type of legal tender. Legal tender, as used in various statutes, is defined as a medium of exchange, including specie, that is authorized by the United States Constitution or Congress for the payment of debts, public charges, taxes and dues. Specie is defined as coins having precious metal content.

Provisions

1.   Prohibits a federally recognized CBDC from being:

a)   used as legal tender; or

b)   the subject or medium of payment of any contract, security or other similar instrument in this state, including contracts relating to commercial transactions. (Sec. 1)

2.   Prohibits transfers made by an escrow agent from an escrow account from being settled or backed by federally recognized CBDC.  (Sec. 2)

3.   Excludes a federally recognized CBDC from the definition of money relating to the Uniform Commercial Code and from the definition of legal tender. (Sec. 1, 10)

4.   Establishes a uniform statutory definition for legal tender and specie. (Sec. 1)

5.   Makes conforming and technical changes. (Sec. 2-10)

6.    

7.    

8.   ---------- DOCUMENT FOOTER ---------

9.                     SB 1095

10.  Initials PB           Page 0 Commerce

11.   

12.  ---------- DOCUMENT FOOTER ---------