![]() Once the prototypes are released, Cunha said, others will be able to see and build on the code. He wouldn’t say if either platform uses the blockchain technology that underlies Bitcoin and other cryptocurrencies. ![]() Powell also said the Fed wouldn’t proceed without support from Congress, ideally in the form of legislation.Ĭunha said the Boston Fed and MIT hope to unveil some of their work in the third quarter, including at least two prototype software platforms that could move, store and settle transactions made with digital dollars. Powell in a Bank for International Settlements panel on Monday said the Fed has “an obligation to be on the cutting edge of understanding the technological challenges” and the costs and benefits of a digital dollar but wouldn’t rush the project. In video remarks last week to a payments conference in Basel, Switzerland, Federal Reserve Chair Jerome Powell may have eased some of the banks’ concerns when he said “digital currencies would need to be integrated into existing payment systems alongside cash and other forms of money.” effort got an extra push last month, when Treasury Secretary Janet Yellen said such a project could help Americans who don’t have access to the banking system. For vendors, settlement would happen almost immediately, without having to wait for the money or worry about fraud. dollars are just digital entries in bank accounts-but the new currency could potentially avoid the go-between of a commercial bank or credit-card network. This is similar to how most money already works-the majority of U.S. Behind the scenes, the digital cash would move from one account to another. Using the currencies could be as simple as holding up the screen of a mobile phone to be scanned. Cash wouldn’t go away, but its use would likely decline. ![]() Unlike those privately created tokens, the new currencies would be issued by central banks as an alternative to paper bills. The growing popularity of Bitcoin, Ethereum and other cryptocurrencies, whose market value has grown to more than $1 trillion, inspired the projects. “The world is moving very quickly on these projects.”Īt issue are forms of digital cash being considered by the U.S. and other countries working on digital currencies as director of the GeoEconomics Center at the Atlantic Council. “The fire has been lit,” said Josh Lipsky, who has helped convene government officials from the U.S. and other countries seem committed enough to digitizing their currencies that it’s making financial industry executives nervous. Nor have they decided how a digital dollar would interact with the existing global payments network. virtual currency, which could still be years away. Treasury Department officials and the Fed haven’t yet approved the rollout of a U.S. “Everyone is afraid that you could disrupt all the incumbent players with a whole new form of payment,” said Michael Del Grosso, an analyst for Compass Point Research & Trading LLC. are trying to work with central banks to make sure the new currencies can be used on their networks. Seeing the threat to their profits, the banks’ main trade group has told Congress a digital dollar isn’t needed, while payment companies like Visa Inc. The financial services industry, braced for what could be its biggest disruption in decades, is about to get an early glimpse at the Federal Reserve’s work on a new digital currency.īanks, credit card companies and digital payments processors are nervously watching the push to create an electronic alternative to the paper bills Americans carry in their wallets, or what some call a digital dollar and others call a Fedcoin.Īs soon as July, officials at the Federal Reserve Bank of Boston and the Massachusetts Institute of Technology, which have been developing prototypes for a digital dollar platform, plan to unveil their research, said James Cunha, who leads the project for the Boston Fed.Ī digital currency could fundamentally change the way Americans use money, leading some financial firms to lobby the Fed and Congress to slow its creation-or at least ensure they’re not cut out.
0 Comments
Leave a Reply. |
Details
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |