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Fed Chairman: The US should not take the global status of the dollar for granted. Digital dollar needed

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At a hearing of the House Financial Services Commission, Lael Brainard stressed the need for a digital dollar that could help maintain its global dominance as similar digital currencies appear elsewhere. “I don’t think we should take the global status of the dollar for granted. In a world where other big states are moving to issue their own digital currencies, it’s important to think about whether the United States will continue to have the same dominance if not we have a similar digital currency, “said Brainard.

In the Fed itself, which performs the functions of the Central Bank, this idea is treated differently.

The vice president of the regulator said that it is those in the leadership of the EDF who are more skeptical about the appearance of the so-called Digital Currency of the Central Bank (CBDC) in the USA. Opponents point out that many dollar transactions have already gone digital, and also raise concerns about user privacy. The Fed has generally said it will not move forward with the idea without strong support from the White House and Congress.

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Brainard confirmed that a decision has not yet been made, but noted that in today’s world, the creation of a digital currency can help ensure the stability of the financial system as cryptocurrencies and digital currencies developed by other countries become more popular. “We recognize that there are risks of inaction as well as risks of action in this area,” she said. circulation.

The Fed vice president added that the digital dollar could coexist comfortably in the US with stablecoins (a cross between a decentralized cryptocurrency and a CBDC). The stability of the stable exchange rate is ensured by linking to real assets (most often the usual currency) and special technical mechanisms.

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The digital yuan has already appeared in China – an electronic currency issued centrally by the People’s Bank of China. They are worth the same as ordinary Chinese paper banknotes. According to the future plans of the Central Bank of China, over time, the digital yuan should replace some of the cash in circulation.

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