US Federal Reserve (FRS) Chairman Jerome Powell said the US is seeking to lead the way in developing standards for central bank digital currencies.
Powell said the Fed is studying the potential of government digital currencies and will publish a report on the findings this summer. The report will present the features of the digital dollar, its risks and benefits, as well as possible options for its use.
The Fed will be ready to discuss with the public how the digital dollar can be used to make payments, and how it can increase the availability of financial services while maintaining data privacy and information security.
The Fed chairman added that due to the high volatility, cryptocurrencies are not suitable for making payments. However, the department is more favorable to conventional and state stablecoins.
“Regardless of the final conclusion that we come to in the course of our research, we intend to play a leading role in the development of international standards for digital currencies of central banks,” – said Powell.
To do this, the Fed is actively interacting with other central banks, including US and foreign regulators. Powell said the Fed is focusing on whether the digital dollar can improve the already secure US domestic payment system.
Any government cryptocurrency should complement cash, not replace it, the Fed chairman said. Given that the digital dollar raises questions about monetary policy, a country’s financial stability and consumer protection, its development will require the maximum involvement of officials and ordinary people.
Powell previously said that the United States would not be in a “race” with China and other countries to launch government digital currencies. However, as many central banks have begun to work hard on this issue, the Fed is serious about launching the digital dollar so as not to be left behind in the financial system.
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