Fed’s Rosengren says important to understand trade-offs of digital currencies

0
41
Fed’s Rosengren says important to understand trade-offs of digital currencies


Investing.com - Financial Markets Worldwide

Please try another search

Economy1 hour ago (May 12, 2021 01:01PM ET)

Fed's Rosengren says important to understand trade-offs of digital currencies
© Reuters. FILE PHOTO: The Federal Reserve Bank of Boston’s President and CEO Eric S. Rosengren speaks in New York, April 17, 2013. REUTERS/Keith Bedford/File Photo

(Reuters) – The Federal Reserve is exploring the technology that would be required to establish a central bank digital currency, but more research needs to be done before it would move forward with a currency, Boston Fed Bank President Eric Rosengren said on Wednesday.

“It is important to highlight that this is exploratory work, and any decision to move forward with such a currency would depend on a variety of factors beyond the technological feasibility and implementation,” Rosengren said in remarks prepared for a virtual event organized by Harvard Law School.

A central bank digital currency could improve financial inclusion, reduce the cost of cross-border financial transactions and provide more flexibility for implementing monetary policy, he said.

But Fed officials would need to fully consider the policy implications and trade-offs that come with using a digital currency, including possible threats to financial stability, Rosengren said.

The Boston Fed is doing research on the technology that could be used to create a hypothetical digital currency through a joint project with MIT’s Digital Currency Initiative.

They plan to release a white paper and open source code early in the third quarter of this year, and later phases of the research project will focus on privacy, anti-money laundering and other issues.

“It is important to understand what problems a central bank digital currency is being designed to solve, and whether other technologies could more cheaply or efficiently address those problems,” Rosengren said.

Related Articles

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Read More

LEAVE A REPLY

Please enter your comment!
Please enter your name here