FED launches discussion on CBDC

The Board of Governors of the Federal Reserve System (FED) published a discussion paper on central bank digital currency (CBDC) entitled Money and Payments: The U.S. Dollar in the Age of Digital Transformation.

The paper explains what the CBDC is, and the benefits and risks of putting it into circulation in the United States. The benefits may include quicker international settlements and preserved international role of the U.S. dollar. The paper also points to a series of challenges that need to be faced, for example the need to find ways to preserve monetary stability and to ensure consumer privacy.

FED seeks input from stakeholders in a request for public comment.

On a side note, as announced by Nirmala Sitharaman, finance minister in India, India will launch digital rupee by the end of the year.

Source: https://www.federalreserve.gov/newsevents/pressreleases/other20220120a.htm

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