Fed considers issuing electronic dollar

This Fed’s electronic currency will be a digital version of the USD and will have a constant value compared to the USD paper money, coins because they are all USD.

The US is launching a national consultation process on the possibility of issuing a central bank digital currency.

The US Senate Banking Committee on June 9 conducted a hearing on the topic, under the direction of Democratic Sen. Elizabeth Warren.

In the near future, the US Federal Reserve (Fed, ie the US Central Bank) will also publish a report titled, highlighting the Fed’s approach to the issuance of electronic dollars.

The move took place in the context of a hot race for central bank cryptocurrencies in the world, with about 60 central banks having expressed interest and plans to pursue a central bank coin. this money. Many countries have released early versions of their own central bank digital currencies.

China has launched a trial circulation of the digital yuan in a number of major cities such as Beijing and Shenzhen and the latest is Shanghai through the form of lottery issuance with the prize of an electronic wallet attached. several hundred yuan. The “red envelopes” will be distributed to the public and winners and they will have to download the app to make purchases at designated locations in the city.

The People’s Bank of China aims to become the first major central bank in the world to issue a central bank digital currency. This is part of an effort to internationalize the yuan and reduce dependence on the global banking and payment system dominated by the US dollar.

Unlike other digital currencies like Bitcoin, the central bank cryptocurrency coin has no anonymity, recognized legitimacy, and its value will be as stable as physical currency. With the US, if issued, this central bank’s electronic currency will be a version of the digital dollar and have the same value compared to the dollar of paper money and coins because they are all USD.

According to a document by the PwC audit group, the Fed has been working on the digital dollar since 2018, but with slower progress than other central banks around the world.