Fed has revealed plans for digital dollar
2 min readUS Federal Reserve (Fed) Governor Lael Brainard recently provided the general public a description of the plans for digital dollar. According to her, the Fed is currently researching and experimenting with digital currency issued by the central bank (CBDC).
Digital dollar concept
During the coronavirus pandemic in April, reports about work on digital dollar began to spread. In addition to the United States, the European Central Bank (ECB) and the International Monetary Fund (IMF) have become interested in digital currencies issued by the Central Bank (CBDC).
Experts in economics, blockchain technology and cryptocurrency have been working on the concept of the digital dollar in the USA. In a speech to the Federal Reserve in San Francisco, Lael Brainard has now stated:
“Given the dollar’s important role, it is essential that the Federal Reserve remain on the frontier of research and policy development regarding CBDCs. As part of this research, central banks are exploring the potential of innovative technologies to offer a digital equivalent of cash…”
In her speech, Lael Brainard explained that the goal of all digital dollar research is to understand the security and effectiveness of the CBDC system. The governor also announced that the United States is involved in a coalition of central banks that share information and experience with the CBDC.
Brainard also highlighted the Fed and the benefits of digital currencies, such as real-time instant payments, low cross-border payment costs, and system-wide credibility. However, the work on the digital dollar and subsequent testing will take several months.
You can see the full speech of the Fed Governor under the attached link here.
After a long-standing controversy over digital currencies, the Federal Reserve is finally working on the concept and plans for digital dollar. However, the United States is in a hurry to build its digital dollar, as China is already conducting final tests on its digital yuan. It could circumvent sanctions and destroy the dominance of the US dollar in the world market.
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