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Fed will Recommend CBDC to Congress: Powell

www.thecoinrepublic.com 25 June 2022 04:08, UTC
Reading time: ~2 m

Jerome Powell, the chairman of the Federal Reserve, stated that the American central bank intends to advise Congress on how to promote a prospective central bank digital currency (CBDC).

Change in the statement within weeks 

Powell stated in March that without congressional action, the Fed wouldn’t keep looking into the creation of a CBDC.

All Americans will be impacted by this very significant potential financial change, he added. In the upcoming years, “our strategy is to work on both the policy side and the technology side and eventually come to Congress with a suggestion.”

In response to a question addressing the Fed’s upcoming steps in the implementation of a CBDC, Powell told American legislators during a monetary policy hearing on Thursday that “it should not be a political item” and that “it’s something we really need to investigate as a society.”

Do we want a private stablecoin to end up being the digital dollar? is one concern with CBDCs. I believe the response is no,” he stated.

If we’re going to have a digital dollar, it should be backed by the government rather than being created privately. Powell demanded a clearer regulatory framework for cryptocurrencies during his first hearing on Wednesday.

The Fed released a paper on the topic of a digital dollar earlier this year, and officials are still going over the investor, traditional financial businesses, and cryptocurrency sector feedback. These responses will probably influence the Fed’s final recommendation.

He said on Thursday that the government, not a private corporation, would have to issue the digital dollar if the United States were to use it.

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