The US Federal Reserve (Fed) released its long-awaited announcement last week Digital Dollar Review. In the document, the Federal Reserve An American CBDC (Central Bank Digital Currency) outlines the pros and cons and opens the discussion to all interested parties and seeks public opinion on the project. According to the organization, the government is trying to maintain. “The dominant international roleOf the dollar.
The study was supposed to be published in mid-2021, but was postponed until last Thursday (20). The forty-page article was said to be “the first step in a public debate on the central bank’s digital currencies between the Federal Reserve and its shareholders.” However, the document Avoid any end Regarding the potential U.S. CPTC.
The Fed did not make decisions about the digital dollar
Instead, the central bank sought to provide a broader vision for all Potential benefits The plan looks at how to speed up the electronic payment system at a time when financial transactions around the world are already increasingly digitalized. Of some Negative issues The report discusses financial stability and the risks to the protection of data and privacy, which are prohibited by mechanisms aimed at protecting against fraud and other financial crimes.
“A CBDC will fundamentally change the structure of the US financial system, changing the roles and responsibilities of the private sector and the central bank,” the report said. Central Bank chairman Jerome Powell is largely ignored in his public comments on the digital dollar. Many officials were skeptical about the plan, saying the benefits were not obvious.
“The Fed’s preliminary analysis suggests that if a potential U.S. CBDC is created, it’s in line with U.S. requirements for privacy-protection, brokerage, transferable and identity – verification.”
The Federal Reserve reads the digital dollar
One The most significant advantage is speed Covit-19 is a system controlled by the central bank to send social policy money quickly to the people in case of need such as the onset of epidemics. Providing financial services to non-bankers was also cited as a positive point.
The primary difference between the digital dollar scheme and other types of digital transactions is that current digital money is the responsibility of commercial banks, while the CBDC is directly responsible to the central bank. Among other things, the central bank The United States does not pay interest on the money savedHowever, for security reasons, some depositors may prefer to keep their money in a central bank.
The United States wants to maintain monetary sovereignty
It also noted that the US government will continue to seek support.The dominant international share of the US dollar“, The article says. This concern is, in part, driven by fears that the digital yuan will take over the monetary sovereignty of the US digital currency.
According to supporters of the digital dollar, the central bank’s delay in implementing the central bank currency will lag behind global competitors, especially China, which already has its own CBDC operating in the country.
The document lists 22 different items for which it asks for public opinion. There will be a comment period of 120 days. Finally, the central bank said Will not proceed without the clear approval of Congress, Preferably in the form of “a specific authorizing law”.
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