Fed Chair Says No Plans to Create Digital Currency, But is Exploring Possibilities
According to Federal Reserve Chairman Jerome Powell, the United States at present has no plans to create a digital currency. In a letter to Rep. French Hill (R-Ark.), Powell said that such a currency would be difficult for the U.S. central bank to adopt as many Americans still rely heavily on cash. Powell also wrote that digitizing currency “would raise important legal, monetary policy, payments policy, financial stability, supervision and operational questions that need to be considered carefully.”
“While we are not currently developing a central bank digital currency, we have assessed and we continue to carefully analyze the costs and benefits of pursuing such an initiative in the U.S.,” Powell wrote.
Private cryptocurrencies have caused a peak of interest in nationally-owned ones. Supporters argue that the benefits include quicker transactions and better credibility and trust than private offerings, as well as easier access to interest-rate tools. Many believe that such products would mean that consumers would not have to rely on banks for changes in interest-rate policy.
Many countries have already adopted digital currencies, but there are still drawbacks for the U.S., as other foreign monetary systems have not been very reliable. “The U.S. payments landscape is highly innovative and competitive, with many such options available for consumers,” Powell added in his letter.