TechFlow news — According to a Federal Reserve press release on August 13, the Fed emphasized its ongoing research and experimentation to better understand the opportunities and risks associated with central bank digital currencies (CBDCs). Federal Reserve Governor Lael Brainard said, “Given the dollar’s important role, the Federal Reserve must remain at the forefront of research and policymaking on central bank digital currencies.” “Like other central banks, we are continuing to assess the opportunities and challenges of a digital currency as a complement to cash and other payment methods, as well as its potential use cases.” The Fed is conducting research and experiments on cutting-edge payment technologies, and its technology laboratory (TechLab) is expanding technical experiments related to digital currencies and other payment innovations.
In addition, the Federal Reserve Bank of Boston is collaborating with researchers at the Massachusetts Institute of Technology to build a prototype virtual digital currency for central bank use. Brainard noted, “Considering a CBDC issuance would require significant policy decisions and extensive discussions and engagement with other parts of the federal government and a broad set of stakeholders. The Federal Reserve has not decided whether to pursue such an important policy process, as we are taking the time and dedicating resources to fully understand the implications of digital currencies and global CBDC developments.”
