The Federal Reserve Chairman unveils the central bank’s plans for introducing a CBDC in the United States: slow and thoughtful development.
On March 7th, during a Senate hearing, the President of the United States Federal Reserve, Jerome Powell, revealed some information about the progress of the digital dollar.
Powell stated that the United States is “very far” from launching a CBDC and that, if introduced, user privacy would not be violated in any way.
The risk of mass surveillance
During the hearing, Powell also addressed concerns regarding the potential introduction of a retail CBDC, discussing the potential risk associated with government surveillance of citizens’ transactions, citing the example of China’s digital currency. The Federal Reserve Chairman emphasized that such an approach is something that would not be tolerated, applied, or proposed in the United States.
According to Powell, the potential launch of a CBDC by the Fed would occur through the banking system:
“The last thing we would want — we, the Federal Reserve, would want — would be to have individual accounts for all Americans, or any Americans for that matter.”
He also reiterated that it is the responsibility of Congress to give the green light to the Fed for the creation of a retail CBDC.
Developments in other countries
Powell’s statements come on the same day when the central bank of Hong Kong announced the start of a new phase for the creation of a wholesale CBDC, which is a currency reserved for commercial banks and financial institutions.
Just a few days ago, the BRICS geopolitical bloc reportedly began working on a blockchain-based payment system.
On March 6th, an official from the central bank of the Philippines stated that the development of a wholesale CBDC would be completed by the end of the year.
