• The U.S. Department of the Treasury has released comments from Undersecretary for Domestic Finance Nellie Liang on the “Next Steps to the Future of Money and Payments,” addressing CBDCs and the approach the American government is taking to their potential implementation.
• The remarks confirmed the formation of a CBDC working group that would advance work on a CBDC, as well as considering potential forms, features, and technology.
• There has also been legislation introduced by Republican lawmakers that would “prohibit the Federal Reserve from issuing a CBDC directly to anyone” although it may not have much of a chance of passing.
U.S Treasury Comments on Central Bank Digital Currency (CBDC)
Formation of Working Group
The U.S. Department of the Treasury has released comments from Undersecretary for Domestic Finance Nellie Liang on the “Next Steps to the Future of Money and Payments,” addressing CBDCs and the approach the American government is taking to their potential implementation. The original Treasury report released in September 2022 described the formation of a CBDC working group that would advance work on a CBDC. Liang’s remarks confirmed this formation, stating it was intended to complement Fed’s work by considering implications for policy objectives requiring an Administration perspective, such as possible forms, features, and technology for a U.S.-issued digital currency.
Potential Retail-Wholesale Separation
Liang discussed how a “potential U.S. CBDC, if one were created” might best serve citizens through private sector accounts or digital wallets facilitating management; which could suggest two different architectures – one retail-facing (for consumers) and one wholesale (focused more towards institutions).
Legislation Prohibiting Direct Issuance
Notably there was also legislation introduced by Republican lawmakers that would “prohibit the Federal Reserve from issuing a CBDC directly to anyone” although it may not have much of a chance of passing; leaving open opportunities with those intermediated by private parties instead..
Real Time Payment Systems
The remarks further describe how real time payment systems are another direction for government action instead or alongside any form or model of digital currency issuance into circulation/ circulation expansion via central bank digital currency (CBDC).
Conclusion
The United States is getting serious in regards to its consideration of a CBDC just as legislation is proposed preventing direct issuance by Federal Reserve; potentially leaving open those intermediated by private parties instead while also looking at other options like real time payment systems
