Although numerous countries are looking to create central bank digital currencies, the US might not be among them. In fact, the Federal Reserve and US Treasury see no merit in this option at all.
In a recent joint statement, both agencies have confirmed there is no need for a digital dollar now, or in the near future.
No Digital Dollar in the Near Future
This is somewhat of a surprising development.
There have been rumors regarding the Federal Reserve creating FedCoin for several years now.
It would appear those plans have been put on ice indefinitely once again, for reasons unknown.
US Treasury Secretary Steven Mnuchin confirms there is no need for a digital dollar in the next five years.
Based on that statement, it would indicate that the US government isn’t threatened by Facebook’s Libra in the slightest.
Although there can be benefits to a digital dollar, the options currently available are still sufficient.
The use of cash in the US indicates how digital forms of money – including a digital dollar – are not taking over in the near future.
Contrary to what many may think, cash usage represents over 30% of all consumer transactions in the US.
Those figures are well ahead of electronic payments, payment cards, and even checks.
The message by the Federal Reserve doesn’t mean other countries won’t issue a central bank digital currency.
Numerous countries still consider this is a viable option, albeit the jury is still out on that one.