Regarding the opportunities and limitations of the central bank's digital currency (CBDC), Fed Chairman Powell officially gave his views.

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.

Jerome Powell, Randal Quarles

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."

We will continue to update Blocking; if you have any questions or suggestions, please contact us!

Share:

Was this article helpful?

93 out of 132 found this helpful

Discover more

News

Who can take the lead in breaking the exchange contract?

Mark Lamb, CEO of CoinFLEX, predicts that by the end of 2020, the derivatives market will reach 20 times the size of ...

Blockchain

We sorted out 40 "running road" cryptocurrency exchanges, all of which share these common routines

Article | Interchain Pulse · Liangshan Huarong On February 23, the ZG exchange was exposed as suspected to be ru...

Market

South Korean Professor tracking Do Kwon's funds: Signs of Terra's collapse were evident in early 2019

Cryptocurrency fugitive Do Kwon has been on the run from Interpol for several months. A Korean professor has been cl...

Blockchain

After the FCoin thunderstorm, rethink everything about platform coins and centralized exchanges

Source of this article: Odaily Planet Daily , original title "In the lifetime, was it pitted by FCoin?" &#x...

Blockchain

Solana Ecosystem Bounces Back from FTX Collapse with a Dash of Resilience and a Pinch of Silver Lining

Solana CEO, Anatoly Yakovenko, discusses the impact of FTX's downfall on Solana's ecosystem startups and projects.

Policy

🚀 FTX Claims Reach for the Sky: AI Investments Boost Recovery Potential

FTX's investment in AI companies has significantly increased their potential recovery during their bankruptcy procedu...