Public Ledger Not Attractive for the US
Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, testified before the House of Representatives’ Committee on Financial Services on Tuesday. The hearing, entitled “Monetary Policy and the State of the Economy,” was chaired by Rep. Maxine Waters.
Illinois Representative Bill Foster asked Powell a number of questions about digital currencies, including the progress of the digital dollar, citing that the Chinese claims they will be rolling out their digital yuan “sometime very quickly.”
Fed Chairman Jerome Powell giving his testimony before House Financial Services Committee on Tuesday.
“Do you feel you have adequate visibility into what the Chinese are doing on this. Do you have working-level contacts that give you some idea of what their rollout is likely to do, like likely to look like?” Foster asked. Powell quickly answered, “Yes, I mean, we certainly have, that.” However, he clarified that the circumstances in the U.S. are completely different from China, elaborating:
For example, the idea of having a ledger where you know everybody’s payments is not something that would be, you know, particularly attractive in the United States context. It’s not a problem for China.
Enormously Important to Keep Currency Centralized
There are many questions that need to be answered around digital currency for the United States, including cyber issues, privacy issues, many many relational alternatives present themselves.
Libra: The Fed’s Wake-Up Call
Frankly, Libra really lit a fire under that and it was a bit of a wake-up call that this is coming fast and could come in a way that it’s quite widespread and systemically important, fairly quickly if you use one of these big tech networks like Libra did.