Federal Reserve Chairman Jerome Powell told lawmakers there was no need to worry about CBDCs.
Chairman Jerome Powell told lawmakers Thursday that the Federal Reserve is “nowhere close” to recommending or even adopting a central bank digital currency.
If central banks adopt CBDCs, it will happen through the banking system, Federal Reserve Chairman Jerome Powell said in testimony before the Senate Banking Committee on Thursday.
“The last thing we, the Fed, want is to have a private account for every American, or for every American,” Powell said. “Only banks have accounts at the Fed and we will maintain them.”
“People don’t need to worry about central bank digital currencies. That’s very unlikely to happen anytime soon,” Powell added.
Republicans have expressed concerns that CBDCs could open the door to government surveillance of people’s transactions. So far, 130 countries, representing 98% of global GDP, are exploring CBDCs in some way, according to the report. atlantic council. Those figures include the United States.
The Federal Reserve has been exploring the possibility of issuing a CBDC and announced one last year. report Although the pros and cons of CBDC have been explored, central bank officials cold water About ideas from the past. Prime Minister Powell also said he would not issue a CBDC without the Federal Reserve. Parliament approval.
Sen. Cynthia Lummis (R-Wyo.) asked Powell on Thursday to confirm his position.
Lummis asked, “Do you still agree that the Federal Reserve cannot introduce a U.S. central bank digital currency without congressional approval?”
“Yes that’s right.” Powell said.
“It really calms people’s fears. People are concerned that we could see things like digital yuan being used as a means of surveillance, so I think this will calm some of those discussions,” Lummis said.
Republican backlash against CBDC
Conservative politicians Charging It has been opposed to CBDCs for some time, citing concerns that they could allow governments the ability to monitor transactions. Florida Governor and former presidential candidate Ron DeSantis signed a bill banning the use of federal CBDCs in the Sunshine State last year.
Republicans on the House Financial Services Committee introduced legislation in September that would ban central banks from issuing CBDCs directly to individuals and block the Federal Reserve from issuing them indirectly through intermediaries.
At the time, some Democrats criticized the bill, with Rep. Stephen Lynch, D-Mass., calling it a “stifling act.” stupidity.”
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