In a new move that is set to change the dynamics of the financial industry in the United States, the country’s Federal Reserve is set to release detailed plans that will guide the process of reviewing the risks and benefits attached to issuing a central bank digital currency (CBDC), a report on Wall Street Journal (WSJ) showed.
Digital dollar review in the offing
According to the report, the review, which might become official as early as this week, would examine how digital currency will affect the country’s economy.
If made, the move by the US Federal Reserve would come amidst similar reviews being conducted in many countries around the world in recent times.
The report also indicated that while the Federal agency might make the review, it does not have the regulatory powers to ensure its implementation due to the unending dispute over the merits of Fed officials regarding technology.
Some that have argued in favor of a digital dollar project have always mentioned how it would easily facilitate international transactions and also how it would introduce the financial market to the unbanked.
However, another angle that needs to be considered when working on a CBDC project of this significance is the fact that the US is an economic powerhouse in the current world settings.
Why it has taken so long
With many countries around the world stepping up their efforts towards a CBDC project, many had expected the United States to lead from the front, however, authorities in the country have dallied on the project ceding its position to China who has made giant strides in its digital yuan project.
Commenting on this, Federal Reserve Chair Jerome Powell had stated that the United States was taking its time to study the benefits of a CBDC because of the role the US dollar plays in the international market.
According to him, it is “more important to do it right than do it fast.”
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