United States Federal Reserve Board Governor Lael Brainard on August 13 said that the central bank was experimenting with distributed ledger technology (DLT) and looking into the possibility of a digital dollar.
- In a speech titled “An update on digital currencies”, Brainard spoke of the potential impact a DLT could have on the US economy
- Governor says that the Federal Reserve is “active in conducting research and experimentation” and is looking into potential use cases
- Notes the COVID-19 pandemic as being challenging for people who need the cash urgently, as indicated by spending patterns upon receiving stimulus cheques
- A digital dollar would make wide scale distribution a much easier prospect
- Believes that there are opportunities, but risks as well, naming privacy, illicit activity, and financial stability as challenges
- Points to Bitcoin (BTC) and Libra with respect to raising questions about regulation and the role of currency
- Other American financial authorities have also commented on a digital dollar, with former CFTC Chairman Christopher Giancarlo now leading the digital dollar project