The blog, published on January 26th, is titled “It’s time to preserve our right to transact privately”. Davidson details the Federal Reserve’s annual Diary of Consumer Payment Choice where the Fed reported that consumers used cash for only 19% of transactions in 2020, which was a 7% decrease from 2019. It is likely that covid-19 has played a big part in the move away from cash. Physical stores have pushed customers to pay by card to reduce the risk of covid-19 transmission via physical contact and online shopping has boomed during lockdowns.
As a result of the increase in non-cash transactions, government agencies have begun a push to monitor these transactions. In the recent infrastructure bill, the IRS proposed a requirement that every transaction worth $600 or more be reported to it, but that provision did not make it into the final bill. In his piece, Rep. Davidson makes clear his view that this amounts to overreach by the government and proposes bitcoin as a solution to enable citizens to transact privately.
Rep. Davidson has been a long-time advocate for cryptocurrencies and cited the Bitcoin whitepaper which says that there needs to be a system that “allow[s] any two willing parties to transact directly with each other without the need for a trusted third-party.” Bitcoin offers this solution. Davidson highlights the similarities between Bitcoin peer-to-peer transactions and cash transactions, both of which can be private. Davidson further details the need for Bitcoin as he believes that implementing tools like Central Bank Digital Currencies could allow for more surveillance on financial transactions.