The US Federal Reserve System (referred to as the Federal Reserve) is exploring the development of the Central Bank Digital Currency (CBDC) and its possible problems and risks.
Financial services reporter Zachary Warmbrodt said in a tweet published on November 20 that Federal Reserve Chairman Jerome Powell responded to US Congressman Frank Hill. And Bill Fosters' question about whether the Fed plans to issue a national digital currency.
- The bottom of the broader market rebounded, and the main force of EOS is brewing a big market?
- Stanford cryptography experts: The "quantum superiority" theory is exciting, but it can not destroy any encryption technology in practical applications.
- Research Report | Cryptographic Liquidity Analysis: BTC, ETH and Stabilizing Coins are the most liquid assets
- Babbitt Column | Blockchain Project Governance, Rules and Influence
- Coinbase: The number of Bitcoin users in the US has reached 27 million
- Zhou Xiaochuan's latest speech: The internationalization of the renminbi is a "premature baby", and the central bank's digital currency is mainly focused on domestic
In his letter, Powell explained the Fed's view on the establishment of CBDC, emphasizing that although the agency has not yet developed CBDC, it has assessed and continues to evaluate the cost and benefits of the program.
Powell revealed that the agency is conducting its own research-centered small-scale experiment to gain hands-on experience and better understand the opportunities and limitations of CBDC.
The CBDC raised a series of legal issues
Powell said that before the issuance of CBDC, the Fed must address some legal issues, including monetary and payment policies, financial stability, regulatory and operational issues, and their vulnerability to cyberattacks. Powell continued:
“If the purpose of CBDC is to achieve transparency in finance and to provide protection against illegal activities, it is conceivable that a generic CBDC may require the Fed to maintain a continuous record of all payment data using this digital currency, which sometimes causes Data privacy and information security."
Finally, Powell pointed out that in the development of CBDC, many design features should be considered, including the management of the liquidity of this currency, the need for a Fed payment system for trading and the anonymity associated with owning and trading CBDC. Sexual problems.
US lawmakers respond to Powell’s letter
In response to Powell's letter, Rep. Hill expressed his enthusiasm for the Fed to study whether it is necessary to issue CBDC, and said:
"This decision will have far-reaching implications for all aspects of US monetary policy and requires in-depth analysis to ensure proper implementation."
Rep. Foster said: "My main concern is that the rapid development of other countries will make us unprepared, which may put our economy at a competitive disadvantage and threaten the primacy of the dollar."
