Texas Lawmakers Introduce Bills to Create Digital Currency Backed by Gold
By Jim Hoft Apr. 7, 2023 8:30 am

The Texas House and Senate recently introduced bills that would establish a state-issued, gold-backed digital currency, Schiff Gold reported.

The outlet added, “Enactment of this legislation would create an option for people to transact business in sound money, set the stage to undermine the Federal Reserve’s monopoly on money and create a viable alternative to a central bank digital currency (CBDC).”

On March 10, Republican Senator Bryan Hughes proposed Senate Bill 2334 (SB2334). On the same day, a similar bill, House Bill 4903 (HB4903), was submitted by Republican Representative Mark Dorazio.

According to the proposed law, the state comptroller must issue a digital currency that is fully backed by gold and fully redeemable in cash or gold. The comptroller would also be responsible for developing a system for regularly transacting with this digital currency guaranteed by gold.

“In establishing the digital currency the comptroller shall establish a means to ensure that a person who holds the digital currency may readily transfer or assign the digital currency to any other person by electronic means.”

“The trustee shall maintain enough gold to provide for the redemption in gold of all units of the digital currency that have been issued and are not yet redeemed for money or gold.”

Schiff Gold reported:

In practice, individuals would be able to purchase digital currency from the state. The state would then use the money to purchase gold that would be held in the Texas Bullion Depository or another secure vault. Individuals would be able to redeem their digital currency for dollars or gold.

A gold-backed digital currency would create an alternative and allow individuals and businesses to avoid a CBDC.

Digital currencies exist as virtual banknotes or coins held in a digital wallet on your computer or smartphone. The difference between a central bank (government) digital currency and peer-to-peer electronic cash such as bitcoin is that the value of the CBDC is backed and controlled by the government, just like traditional fiat currency.

At the root of the move toward a CBDC is “the war on cash.” The elimination of cash creates the potential for the government to track and even control consumer spending.

Nigeria is already trying to get people to accept its CBDC (with a great deal of resistance), and China, India, and the US have all launched pilot programs to test CBDCs.

Imagine if there was no cash. It would be impossible to hide even the smallest transaction from the government’s eyes. Something as simple as your morning trip to Starbucks wouldn’t be a secret from government officials. As Bloomberg put it in an article published when China launched a digital yuan pilot program in 2020, digital currency “offers China’s authorities a degree of control never possible with physical money.”

The government could even “turn off” an individual’s ability to make purchases. Economist Thorsten Polleit outlined the potential for Big Brother-like government control with the advent of a digital euro in an article published by the Mises Wire. As he put it, “the path to becoming a surveillance state regime will accelerate considerably” if and when a digital currency is issued.

A gold-backed digital currency would create an alternative to CBDCs.

https://www.thegatewaypundit.com/2023/04...backed-by-gold/

I wonder if this could be a money-making endeavor for the state? Seems like it. And the feds would be hell-bent not to allow our rights under Art I Sec 10 to make it happen as it is a threat to its monopoly.

Looks to be a way to make Texas wealthy after all, at the expense of the Feds. Means the Feds will not allow this to happen at all costs.

Texas May Launch Its Own Gold-backed Digital Currency
By ZeroHedge - Apr 08, 2023

Impact

The creation of a state-issued gold-backed digital currency would create currency competition with Federal Reserve notes and undermine the Fed’s monopoly on money. It would also provide an alternative if the Federal Reserve implements a central bank digital currency.

Broadly speaking, by making gold conveniently available for regular, daily transactions by the general public, gold-backed digital currency would create the potential for a wide-reaching effect. Professor William Greene, an expert on constitutional tender, said in a paper for the Mises Institute that when people in multiple states actually start using gold instead of Federal Reserve notes, it would effectively nullify the Federal Reserve and end the federal government’s monopoly on money.

“Over time, as residents of the state use both Federal Reserve notes and silver and gold coins, the fact that the coins hold their value more than Federal Reserve notes do will lead to a ‘reverse Gresham’s Law’ effect, where good money (gold and silver coins) will drive out bad money (Federal Reserve notes).

“As this happens, a cascade of events can begin to occur, including the flow of real wealth toward the state’s treasury, an influx of banking business from outside of the state – as people in other states carry out their desire to bank with sound money – and an eventual outcry against the use of Federal Reserve notes for any transactions.”

Gresham’s Law holds that “bad money drives out good.” For example, when the U.S. government replaced silver quarters and dimes with coins made primarily of less valuable copper, the cheap coins drove the silver out of circulation. People hoarded the more valuable silver coins and spent the less valuable copper money. So, how do you reverse Gresham?

The key is in making it easier to use gold in everyday transactions. The reason bad money drives out good is that governments put up barriers to using sound money in day-to-day life. That makes it more costly to spend gold and incentivizes hoarding. When you remove barriers, you level the playing field and allow gold and silver to compete head-to-head with Federal Reserve notes. On an even playing field, gold beats fiat money every time.
https://oilprice.com/Metals/Gold/Texas-M...l-Currency.html