In recent months, Powell has emphasized several times that the U.S. would not act fast on issuing a digital dollar because of the physical dollar’s status as the global reserve currency.
The latest comment, though, is in line with Powell’s previous remarks about the Fed taking the prospects for a digital dollar seriously. Powell has said the Fed will engage with the public on the topic in 2021 and will seek congressional approval before issuing one.
CBDCs are an early-stage payments innovation that governments hope can increase payments efficiency and lower costs by running them on blockchains. The details on CBDCs are still murky, and detractors argue most transactions today involve money that’s already digital.
There’s a fear some governments may use CBDCs for increased financial surveillance. At the moment, it looks like the U.S. could favor privacy in its CBDC development.
I tuned in to this discussion on CNBC last night and what I found interesting is the eagerness central banks have in talking about digital currencies while at the same time saying they are in no rush.Click HERE to subscribe to Fuller Treacy Money Back to top