Governor of the Federal Reserve Bank of Philadelphia, United States: The central bank’s digital currency is inevitable, but the United States should not take the lead

Patrick Harker, president of the Federal Reserve Bank of Philadelphia, believes that the central bank's digital currency is inevitable.

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According to Reuters reported on October 2, Huck said that central banks including the Federal Reserve will inevitably issue digital currency.

Despite this, Huck believes that the United States should not take the lead in view of the role of the dollar as the world's reserve currency and the need to test new technologies. He said at a community bank meeting on the central bank's digital currency:

"This is inevitable… I think we'd better start to solve this problem."

Will not be released soon

Huck made the remarks when answering questions about the Fed’s decision to develop its own instant payment system. He pointed out:

"I am observing the next five years. What will happen next? I do think this will be related to digital currency."

As Cointelegraph recently reported, at a quarterly meeting of the Federal Advisory Committee (FAC), some major US banks said that Facebook's "Libra" encryption program would likely create a "shadow banking" system.

According to Bloomberg News, the Fed asked the major banks in the country about Libra, which expressed their negative stance on the project and outlined the risk that demand deposit accounts and bank payments may fall.

According to reports, these major banks said at a quarterly meeting in early September that Libra and similar stable currencies anchored the potential value of one or more fiat currencies, which may also constitute a banking model based on privacy. challenge.

The banks noted that in 2018, about 52% of the US population (170 million people) were considered active Facebook users, suggesting that Facebook may create a digital currency ecosystem outside the sanctioned financial markets or “ The “shadow banking” system, which also said that as consumers adopt Libra, more deposits may be transferred to their platforms, significantly reducing liquidity, while non-mediation may extend further into lending and investment services.