The president of the Federal Reserve (FED), Jerome Powell, described the digital dollar as a “high priority project”, this Tuesday, February 23, during a hearing before the Senate Banking Committee . In the session, he confirmed that the possibility of the United States issuing its central bank digital currency (CBDC) is being studied as several nations around the world are considering.
Powell believes that it will soon be will require the approval of the US Congress to develop a digital dollar. Although “that is not clear until we see in which direction we are going.” But was convinced that 2021 will be an important year to move forward with this project.
The president of the FED added that there are political and technical elements to resolve before starting a project for the development of a CBDC and, in that sense, he said: «we are going to have a dialogue public”. This, with the idea of knowing the position that all the groups interested in the project could have.
Powell recognized that a digital dollar can contribute to greater financial inclusion, but his concern seems to revolve around which, today, the United States has a functioning banking and financial system and a solid capital market. “The Fed must be careful not to undermine this by creating a digital dollar,” he said.
In October last year, the United States did not seem in a rush to issue its digital version of the dollar. As CriptoNoticias reviewed, Powell pointed out at that time that it was more important to study the risks well than to be the first to issue a CBDC. However, at that time there were those who stated that “something” would end up replacing the US currency as a global store of value.
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Jerome Powell’s position regarding the issuance of a digital dollar coincides with that indicated by the Secretary of the Treasury of the United States, Janet Yellen, who on Monday February 22 was in favor of continuing exploring the possibility of a CBDC.
«It makes sense for central banks to look at it “He said as reported by Forbes. “We have a financial inclusion problem. Too many Americans don’t have access to simple payment systems or bank accounts, and I think a digital dollar could help. I think it could lead to faster, safer and cheaper payments, ”Yellen pointed out.
Yellen also suggested that the digital dollar could be appropriate for the Fed to respond to the excitement that has been unleashed around bitcoin , both for its new historical price records, and for the announcements of large companies such as Tesla, Square or Microstrategy to invest in the cryptocurrency.
In any case, everything seems to indicate that a partnership between the Federal Reserve and the US Treasury could be brewing to create a digital currency issued by the central bank.