Critics of the current system say it locks out many low-income people and charges them for basic services that people with high account balances don’t suffer from.
Digital currency accounts held by individuals could serve as a form of competition. Yet the banking system offers high protection to depositors, including insurance, which a less regulated system might not offer.
“Our primary focus is on whether and how a CBDC could improve an already secure, effective, dynamic and efficient US domestic payments system,” said Powell.
“We believe it is important that any potential CBDCs can serve as a complement, not a replacement, for current private sector cash and digital forms of dollar, such as deposits in commercial banks.”
Powell said that “cryptocurrencies have not been a convenient way to make payments to date, given, among other factors, their fluctuations in value.”
He said he hoped the document would represent a thoughtful process.
“Regardless of the conclusion we reach, we plan to play a leading role in the development of international standards for CBDCs, actively collaborating with central banks in other jurisdictions as well as with regulators and supervisors. here in the United States throughout this process. ”