"Doing It Right Is More Important Than Being the First"
[Asia Economy New York=Correspondent Baek Jong-min] Jerome Powell, Chairman of the U.S. Federal Reserve (Fed), stated that no decision has been made regarding the introduction of digital currency. However, he expressed the intention to maintain cooperation with the private sector concerning the adoption of digital currency.
This is interpreted as the U.S. taking a cautious stance on issuing a digital dollar, even as China has begun testing the introduction of the digital yuan.
On the 19th (local time), Powell delivered a speech titled "Cross-border Payments and Digital Currency" at the International Monetary Fund (IMF) Annual Meeting held via video conference, saying, "We are committed to carefully and thoroughly evaluating the potential costs and benefits of a central bank digital currency (CBDC) for the U.S. economy and payment system," and "We have not yet decided whether to issue a CBDC."
He said, "I believe it is more important to do it right than to be first." He also emphasized that even if a CBDC emerges, it will serve as a complement rather than a replacement for physical cash.
He pointed out, "Doing it right means examining not only the potential benefits of a central bank digital currency (CBDC) but also the potential risks," adding, "There is a need to protect the CBDC from cyberattacks, counterfeiting, and fraud."
He continued, "There are also issues concerning how a CBDC would affect monetary policy and financial stability, and how it can prevent illegal activities while protecting users' privacy."
Powell noted that interest in CBDCs increased among central banks worldwide after Facebook announced the development of its own virtual currency, 'Libra,' last year.
He also stated that the Fed is actively participating in digital currency research alongside other central banks and the Bank for International Settlements (BIS).
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
