FED President Classifies Digital Dollar as High-Priority Project
Jerome Powell, the Federal Reserve (FED) president, treats the digital dollar as a “high priority project.” Powell confirmed in a hearing before the Senate Banking Committee that there is a high chance for the United States to issue its central bank digital currency (CBDC). Several nations worldwide are also considering the same fact.
Powell believes that approval from the US Congress will be a requirement to develop a digital dollar. Although “it is unclear until we see in which direction we are going.” But Powell was convinced that 2021 would be a crucial year to move forward with this project.
The FED president also added that there are political and technical elements to solve before launching this nature project. He said: “A public dialogue is going to happen.” This dialogue intends to know the position that all the groups interested in the project could have.
Powell acknowledged that a digital dollar could contribute to greater financial inclusion. Still, his concern seems to revolve around the fact that today’s the United States has a functioning banking and monetary system and a strong capital market. He stated that the Fed must be careful by creating a digital dollar.
In October of 2020, the United States seemed quiet about issuing its digital version of the dollar. Powell pointed out that it was more relevant to focus on studying the risks better than to be the first to publish a CBDC. However, at that time, some said that “something” would end up replacing the US currency as a global store of value.