The Chairman of the US Federal Reserve said that his department, the country's main financial regulator, is not ready to begin practical work on launching a digital dollar without Congressional approval..
The announcement was made on Tuesday, February 13, at a closed meeting with members of the House Financial Services Committee.. Jerome Powell actually shifted responsibility for the launch of the American central bank digital currency to parliament.
“We are not proponents of CBDC and have not made a decision to recommend to Congress the launch of a digital dollar. If we are tasked with creating a national digital currency, Congress must authorize our actions,” the official said.
Jerome Powell added: a separate legislative framework will also be needed to regulate the circulation of CBDC.
Earlier, executive director of The Digital Dollar Project Jennifer Lassiter said that the Fed was waiting for direct instructions from the White House administration and Congress to begin more substantive work on the digital dollar project:
“Congress plays a decisive role in the CBDC project. Depending on how and in what form parliamentary support is expressed, this will affect consumer confidence in the digital dollar and the likelihood of legal problems that could stop the project.”.
Last year, analysts at financial services firm RBC Wealth Management announced that the privacy and security risks of central bank digital currencies may outweigh the potential benefits..