Digital Doller Will Be Supported By The FED: One of the most established financial institutions in the world, such as the FED or the Federal Reserve of the United States, is preparing for the possible integration of the digital dollar. It can be compared to one of the largest countries in Asia, China, which uses Yuan Pay Group for trading.
The introduction of a CBDC, an acronym for the new digital dollar, will be a good project for the growth and development of the US economy.
This economic institution will wait for proposals and comments until May and express that it gives legislators the power to adopt the new CBDC digital currency.
During this study process and analysis of the advantages and disadvantages of issuing a central bank digital currency in the United States, the general public, elected representatives, and a broad group of stakeholders in this project interacted.
The Fed defines that one of the advantages of the digital dollar will be to maintain the power of the dollar in the international financial system; this is the leading and inevitable objective for central banks.
Highlights of the CBDC Issuance
Although the issuance of the Cbdc would help provide a reliable digital payment possibility that benefits all users in general, it also operates between countries, although there may be disadvantages.
The challenge of this project encompasses the conservation and balance of financial stability, ensuring that the digital dollar complements the current means of payment and exchange.
The central bank will focus on addressing and encompassing important political aspects before the issuance of a CBDC, such as specifying that there is no violation of the privacy of Americans and the power and ability of the government to prevent and eradicate illicit finances and businesses.
Based on the analysis, it is presumed that a Cbdc would adapt very well to the needs of the United States and the current financial and economic system; therefore, users would not have accounts or Cbdc addresses in the Fed.
This study does not intend to anticipate any result in detail nor emphasize that the Federal Reserve does not make any unavoidable decision based on the importance of creating and issuing a US CBDC.
Many participants who were part of this study have made it clear that they are interested in this project obtaining and having great support, being, in the best of scenarios, a consequence of the action of Congress.
At the same time, it differs in carrying out digital cash transactions, which are constantly carried out through sizable commercial banking entities, which will provide users with a particular and direct option to the central bank, equal to actual cash.
A firm strategy for economic stability
Being the issuance of its digital currency, good or bad, is the most studied option and demand by world governments, with which they advance ground in digital trade and finance; China is a country that is in command of the digital version of the yuan, which is already in limited circulation.
It is remarkable how a large part of the central banks belonging to the countries that make up the G-20 is studying the possibility of creating and issuing their digital currency and estimating that by 2024 there will be a large part of them with a type quarter of them will be some digital currency die cash in movements of the commercial markets.
The benefit of the FED supporting the nascent digital dollar is a significant advantage; since cryptocurrencies do not have this palpable and tangible support, this strategy will achieve very marked stability in digital markets.
Many users are inclined to invest and have their capital in this new digital currency because it provides security and reliability, less volatility, and monitoring by government entities and banking organizations, preventing investments from being of illicit origin.
The government of the United States, with the implementation of this strategy, will manage to preserve the economic and financial stability of the country, dealing a blow to cryptocurrencies, which will not be able to compete with a traditional currency that will now become digital and provide significant benefits for all its users.
Banking entities will have a more significant number of accounts, which will increase the benefits offered by these organizations, such as loans, trusts, long-term investments, real estate financing, and many more options that provide economic security to their users.