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Bill to “End the Fed” Put Forward By Thomas Massie: What Does it Mean for Crypto?

Last Updated May 21, 2024 3:21 PM
Teuta Franjkovic
Last Updated May 21, 2024 3:21 PM
By Teuta Franjkovic
Verified by Peter Henn

Key Takeaways

  • Republican Congressman Thomas Massie introduced a bill to abolish the US Federal Reserve after a Twitter poll.
  • The poll saw 86% of more than 115,000 voters supporting the end of the Fed.
  • Massie introduced the Fed Board Abolition Act, aiming to dismantle the US central banking system.
  • The crypto community now waits to see what impact, if any, Massey’s proposal will have.

On May 15, Republican Congressman Thomas Massie asked his Twitter whether he should propose legislation to abolish the US Federal Reserve.

The poll  attracted over 115,000 votes, with an overwhelming 86% in favor of ending the Fed. Many members of the crypto community publicly supported his decision, so Massie kept his promise .

Now the crypto community wants to know whether or not Massey’s bill will have an impact on blockchain finance. However, similar legislation has been tried in the past, and failed.

Thomas Massie Poll Gets Support for Ending the Fed

Kentucky Congressman Massie, asked  his followers whether he should introduce legislation to abolish the Federal Reserve. The poll, which concluded on Thursday with more than 115,000 votes, offered voters the choice to either “end the Fed” or “keep the Fed”

The results were overwhelmingly in favor of abolishing the US central bank, with 86.6% supporting the “end the Fed” option.

However, a self-selecting Twitter poll should not be taken as a proper assessment of public opinion.

Thomas Massie Puts Forward Bill to Abolish the Fed

Just one day later, Massie kept his promise and introduced H.R. 8421 , titled the Federal Reserve Board Abolition Act. This proposal seeks to get rid of America’s central banking system. It wants to abolish the Board of Governors of the Federal Reserve and the Federal Reserve banks. It also calls for the repeal of the Federal Reserve Act , the 1913 law that founded the Federal Reserve System.

He stated:

“Americans are suffering under crippling inflation, and the Federal Reserve is to blame. During COVID, the Federal Reserve created trillions of dollars out of thin air and loaned it to the Treasury Department to enable unprecedented deficit spending. By monetizing the debt, the Federal Reserve devalued the dollar and enabled free money policies that caused the high inflation we see today.”

Thomas Massie is not alone in his critical stance towards the Federal Reserve. However, most efforts have traditionally aimed at auditing the central bank rather than dismantling it. The Federal Reserve  always been a point of contention. One of the first politicians to challenge the Fed’s operations was Democrat Wright Patman . In the 1950s, 1960s and 1970s, introduced 16 bills aimed at auditing or curbing its independence.

Patman’s fellow Texan, Republican Ron Paul, proposed the “Audit the Fed ” bill in 2009. This legislation, which failed to pass, focused on looking the Fed’s monetary policy decisions and operations.

Following in his father’s footsteps, Rand Paul has actively supported  this legislation since his Senate election in 2010. Continuing this legacy, Thomas Massie introduced the “Audit the Fed” bill in the 114th Congress, which was originally championed by Rand Paul.

Fed’s Monetary Policies Fuel Controversy in Crypto

The controversy surrounding the US Federal Reserve also extends into cryptocurrency, an area where the central bank’s traditional monetary policies and its sstance on digital currencies intersect. Critics argue that the principles driving skepticism towards the Fed’s handling of fiat also apply to its approach towards cryptocurrencies.

The Federal Reserve’s control over the money supply and its influence on inflation are concerns for cryptocurrency advocates. They see cryptocurrencies as a way to escape central banks’ control.

Also, the Fed’s exploration of a Central Bank Digital Currency (CBDC) has raised additional concerns about privacy and central bank surveillance into digital transactions. This, crypto supporters say, goes again the decentralized ethos of blockchain finance.

Crypto Community Wants Bitcoin and Tax-Free Policies

Some Twitter users who voted on Massey’s poll went even further, sayinf the  extending their advocacy to include abolishing  the US Internal Revenue Service (IRS). Some participants encouraged Massie to endorse Bitcoin to help undermine the Federal Reserve.

Pierre Rochard of Riot Platforms proposed  that, by passing stablecoin legislation to allow the private sector to inflate the dollar and making Bitcoin tax-free, Bitcoin could compete fairly against the dollar. This, in turn, could start a self-driven phase-out of the Federal Reserve.

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