Yellen Says Broad Consensus Among Authorities Needed to Issue a CBDC

US Treasury Secretary Janet Yellen has not yet formed an opinion on the possible issuance of a digital dollar. At the Reuters Next conference, she said that Congress, ФРС and the White House need to reach agreement on a number of questions.

“This [the issuance of a CBDC] is an important decision that requires consensus. There are some advantages, but there are also significant costs. The step could lead to the disintermediation of the banking system. You see, we need to work through all the pros and cons. I don’t yet have a view of my own,” she said.

According to Yellen, government agencies need to study the drawbacks and benefits of CBDC, including its impact on the banking system. The secretary noted that the Fed will soon present a report on the matter.

She clarified that within the administration the digital dollar has not been discussed “in earnest” and Congress, in turn, should also weigh in.

In September the Fed expanded research into digital currency. Several regional banks joined the regulator’s initiative. According to Cleveland Fed President Loretta Mester, the project is creating and testing various distributed ledger platforms.

Earlier, Fed Governor Lael Brainard said that the country needs ‘to expedite the development of the digital dollar’ without delay.

In October, the Fed named one of the possible threats to the dollar’s hegemony in the long run.

In November, the U.S. Treasury released a report on risks associated with stablecoins. The agency saw in “stablecoins” a threat to investors and market integrity, and also called for strict regulatory constraints.

In 2022, U.S. banking regulators will prepare a guide on cryptocurrencies.

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