Federal Reserve sues Bitcoin Magazine over FedNow trademark
Cryptocurrency media outlet Bitcoin Magazine is apparently locked in a legal standoff with the Federal Reserve over a line of parody apparel. The central bank issued a cease-and-desist order demanding that the magazine stop using its FedNow trademark on merchandise. However, Bitcoin Magazine is pushing back, invoking First Amendment protections.
The Federal Reserve alleges that Bitcoin Magazine’s merchandise, which features a logo resembling the FedNow service mark with a watchful eye in place of the letter “O,” constitutes unauthorized trademark infringement. The publication and its legal team are denying the charges, insisting that their products fall under the umbrella of protected speech.
The Federal Reserve’s FedNow service, a newly launched digital payments system, has been met with skepticism from Bitcoin Magazine and the wider crypto community. Critics like Bitcoin Magazine argue that such a service could lead to a central bank digital currency (CBDC), potentially increasing the risks associated with centralized financial systems, such as transaction censorship.
Bitcoin Magazine has been a vocal critic of the Federal Reserve since its inception in 2012, questioning the institution’s exclusive control over money issuance in the U.S. economy through various publications. The outlet’s contentious merchandise is a continuation of its critical stance, alleging it aims to spotlight threats to civil liberties posed by systems like FedNow.
The cease-and-desist order, as reported, originated from the Federal Reserve Bank of Chicago. It asserts that the merchandise could mislead consumers into believing there is an affiliation or endorsement from the Federal Reserve, a misconception the central bank wants to avoid.
In response, Bitcoin Magazine has drafted an open letter to Thaddeus Murphy, Deputy General Counsel for the Federal Reserve Financial Services, highlighting their position in the dispute. The magazine’s defense strategy leans heavily on the First Amendment, indicating a willingness to defend its stance on grounds of free speech and parody.
“We would like to inform you that while we received your cease-and-desist request, we refuse to comply. We will not be intimidated by your efforts to silence criticism. As you may know, our publication and our readership are deeply troubled by the new FedNow interbanking communication system. We believe not only that it is possibly unconstitutional, but that it threatens the very freedoms that all liberty-loving American citizens should hold dear,” the magazine statement reads.
This legal entanglement comes at a time when tensions between traditional financial institutions and the crypto community are especially palpable, with each party scrutinizing the other’s approach to digital currencies and financial privacy.
The Federal Reserve says that over 100 financial institutions and service providers have embraced FedNow. Currently, the service accommodates 108 institutions engaged in sending and receiving payments over the network. Additionally, 21 financial institutions are offering liquidity and settlement services, while 20 service providers are facilitating payment processing.