The Treasury Department’s top official for financial markets and stability expressed little urgency over the federal government’s need to prepare for the potential launch of a digital US dollar.
Regulators need to examine whether a central bank digital currency — or CBDC — would actually improve the speed or cost of real time interbank payments, which the Federal Reserve is aiming to introduce in 2023, said Nellie Liang, undersecretary for domestic finance at the Treasury.
Asked whether a digital dollar would help defend the primacy of the dollar in international commerce or as a reserve currency, she was even clearer.
“My view is our global leadership doesn’t come from our technology,” she said in an interview at Bloomberg News’s Washington office Monday. “It comes from our governance system, the rules that govern our financial markets, our rule of law and the safety and soundness of our institutions.”
No Current Need
If after five or more years many countries have introduced a CBDC, she added, that might become a factor in pushing the US to adopt one. But she emphasized the US government’s study of a potential CBDC was mainly to be prepared for a need that didn’t currently exist.
In a September report, the Treasury “set out a very deliberate, forward path for considering CBDC so that the Fed would be in a position to issue one if it decided it wanted to,” she said.
The Fed in January published a white paper on central bank digital currency, without committing to issuing one. Such a move, it said, would have to be made jointly with Congress and the executive branch.