The US is not going to lag behind other countries in the race for the first national digital currency. As cryptocurrencies continue to soar, the Federal Reserve is giving thought to having its own digital asset. During a digital seminar on trans-Atlantic economic relations, Deputy Secretary of the Treasury Justin Muzinich announced that the administration was studying a potential central bank digital currency (CBDC) tied to the US dollar.
Answering a question about whether there is an official plan for the development and implementation of the central bank digital currency, the official confirmed that the Fed was exploring the idea of launching its own digital currency. "It’s something we’re studying … This is really a decision which sits as much with the Fed as it does with the Treasury," he pointed out. However, some conference participants were unhappy with evasive answers and the question was asked once again. Justin Muzinich had to admit that there was no final decision on this matter yet.
"There are clearly efficiency benefits and cost benefits to using a distributed ledger. And I also think, more broadly, it’s important for the government to embrace innovation and not be scared by it," he added. However, Muzinich also pointed out that there were concerns about security, financial stability and privacy as part of the introduction of the digital currency in the country. "The Treasury has made it clear that the obligation to comply with US laws is the same, regardless of whether a transaction is denominated in traditional fiat currency or digital currency. Existing laws apply to digital assets in no uncertain terms," he pinpointed.
