The United States is far from making a decision on the potential launch of a Central Bank Digital Currency (CBDC), according to Federal Reserve Vice Chairman Michael Barr, who said the Federal Reserve is still doing “basic research” on the project.
During remarks delivered at a Philadelphia event, Barr highlighted the Federal Reserve’s position, saying the regulator is still “a long way” from making a decision on the “next steps in terms of payments system development.”
The Federal Reserve is still looking at the “system architecture” and tokenization models” of a potential CBDC and made it clear that even if the research was completed, any substantive action towards the creation of a CBDC would require backing from the executive branch and authorizing legislation from Congress.
The idea of a CBDC and a digital dollar has already faced skepticism from numerous Republican lawmakers. On stablecoins, Barr noted he remains “deeply concerned” about their issuance “without strong federal oversight.”
Per his words, non-federally regulated stablecoins could pose significant financial stability and monetary policy risks if they are to become widespread means of payment and stores of value.
Also published on Medium.
