Confirmations arrive for adoption of a digital currency by the US, and this time are official and heavy confirmations. As you know, the institutional interest around the world of cryptocurrencies is growing more and more. After Tesla’s announcement, Blackrock, Jp Morgan also intervened, but the list could be very long. We can summarize that it is now being talked about everywhere, but the most important statements we want to report are those of the American treasury secretary and the president of the Federal Reserve (the American central bank) Jerome Powell. The Fed chairman is no longer hiding, and said the central bank is carefully examining the prospect of issuing a digital dollar, but he says more. Infact, I don’t know anything new about this type of affirmation, we have already heard them. But beware, the first thing to think about, is that the scenario has changed: today we are not in the same situation as a few months ago, we have a new administration in the US, new interests are at stake, new prospects for the monetary, economic and financial future are at stake.
Before going into the affirmation, let’s take a moment to take stock of the situation on digital currency the digital currencies of central banks in general: the digital currencies of central banks are nothing more than forms of money held electronically, without any connection and banknotes or physical coins. They are different from decentralized cryptocurrencies like Bitcoin – which are not controlled by any boss, by any entity, by any institution -. Central banks’ centralized digital currencies are controlled by themselves, opposed to Bitcoin.
Treasury Secretary Janet ellen has expressed his opinion on this matter by saying that too many Americans do not have access to easy payment systems and bank accounts
“Too many Americans don’t have access to easy payments systems and banking accounts, and I think this is something that a digital dollar, a central bank digital currency, could help with,” she said. “It could result in faster, safer and cheaper payments, which I think are important goals”.
How can digital money work for central banks? In order to print an unlimited supply, it must be kept under control by a central body. And of course a digital currency like this automatically creates a digital identity, which is difficult to do with cash. Which is difficult to do with bitcoin or other cryptocurrencies, which are the new cash. Because cash is not just the banknote you have in your pocket, cash is that form of money that guarantees you to hold value and that can guarantee privacy on your purchase preferences, on the payment system used, etc. The same thing will carry over to cryptocurrencies which will be the new cash. And it’s basically understand what the idea of cash is, because many people think at cash as just paper, while new cash will move to decentralized cryptocurrencies.
Federal Reserve Chairman Powell said that since the US dollar serves as the world’s reserve currency it is more important that the project is correct. That is, that it is done in a right way, and that the Central Bank of the United States can be the first to unveil a new digital version of its currency.
Powell went on to say that “we are looking carefully, very carefully at the question of whether we should issue a digital dollar.”
As you know, China is already testing its own version of digital currency. Even considering this, there seems to be an acceleration. We had heard statements in recent months from institutional actors, which suggested that these projects could not be implemented before around 2024. But there seems to be an acceleration, at least as regards the launch in the test phase, and who knows if everything is ready and it’s just a matter of deciding when to unveil the project.
