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Fed Chair Signals Shift Major Shift in Central Bank Policy Toward Crypto Currencies

Fed Chairman Jerome Powell2

the staff of the Ridgewood blog

Washington DC, in what appeared to be a signal of change in US policy toward digital assets Federal Reserve Chairman Jerome Powell said on Thursday that  prospective digital currencies issued by central banks must accompany cash and other types of money within a flexible payment system.

“A recent report from the Bank for International Settlements and a group of seven central banks, which includes the Fed, assessed the feasibility of central bank digital currencies (CBDCs) in helping central banks deliver their public policy objectives,” Powell said in prepared remarks at a payments conference hosted in Basel, Switzerland.

“One of the three key principles highlighted in the report is that a CBDC needs to coexist with cash and other types of money in a flexible and innovative payment system.”

The COVID-19 crisis has underscored the less systematic areas of the current payment system and sped up the need for digitalization, he said. The Federal Reserve Bank of Boston is said to be collaborating with MIT researchers to explore digital currencies in addition to experiments the Fed’s board of governors is conducting.

Fed Chairman Jerome Powell

The Fed Chair underscored three Major Points

1.Fed Chairman Jerome Powell said potential central bank digital currencies must coexist with cash.

2.COVID-19 has brought forward the need to address the limitations of current payments.

3.Achieving an improved payments system would require multiple stakeholders to collaborate.


2 thoughts on “Fed Chair Signals Shift Major Shift in Central Bank Policy Toward Crypto Currencies

  1. We have innovative payment systems. Plenty of them.
    You can wire money.
    You can send by ACH.
    You can Venmo.
    You can Apple Pay.
    You can use PayPal.
    Crypto is 100% bullshit.

    1. some use a crypto based block chain to send money like Money Gram

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