Federal Reserve Chairman Jerome Powell provided an update on the Fed’s central bank digital currency (CBDC) work at a hearing before the House Financial Services Committee. Stating that the Fed is “making progress on technology issues,” Powell emphasized that “policy issues are just as important.”
Fed Chairman Powell on CBDC progress
During a hearing before the House Financial Services Committee on Wednesday, Congressman Stephen Lynch (D-MA) asked Federal Reserve Chairman Jerome Powell for an update on the Fed’s work regarding a possible digital currency. of the central bank (CBDC), the digital dollar. Congressman Lynch serves as a Ranking Member of the Subcommittee on Digital Assets, Financial Technology, and Inclusion.
Regarding where the Fed stands on its CBDC work, Powell said:
We interact with the public continuously. We are also doing research on policy and also on technology. That’s what we’re doing.
Noting that the Fed “came out to comment, generally, on the CBDC about a year ago,” Powell said he expects the central bank to do the same in the future, but he can’t give a date for when that will happen.
When asked about the Fed’s decisions regarding the structure and architecture of a CBDC, the Fed chair clarified:
We are not at the stage of making any real decisions. What we’re doing is experimenting in a kind of early stage experimentation.
“How would this work? Works? What is the best technology? Which is the most efficient? – We are really at an early stage, ”he continued.
While emphasizing that the Federal Reserve is “making progress on technology issues,” Chairman Powell stressed that “policy issues are just as important.” He concluded:
We have not decided that this is something that the country’s financial system wants or needs, so that is going to be very important.
Meanwhile, several bills have been introduced in Congress to restrict the use of a CBDC should the Fed introduce one. Last month, Congressman Tom Emmer (R-MN) launched the state’s CBDC Anti-Surveillance Act that “prohibits the Federal Reserve from using a CBDC to implement monetary policy and control the economy.”
Do you think the Fed will eventually issue a central bank digital currency? Let us know in the comments section.
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