Tuesday, February 23, 2021

Yellen Signals Interest in Backing Digital-Dollar Research

(Bloomberg) -- Treasury Secretary Janet Yellen signaled the Biden administration supports research into the viability of a digital dollar, a shift from the lack of enthusiasm shown for the concept under her predecessor, Steven Mnuchin.

“It makes sense for central banks to be looking at” issuing sovereign digital (crypto) currencies, Yellen said at a virtual conference on Monday hosted by the New York Times.

She said a digital version of the dollar could help address hurdles to financial inclusion in the U.S. among low-income households. "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.”

A number of central banks, including the U.S. Federal Reserve, have been conducting research into how digital versions of their own currency would work. Officials generally see both opportunity and risks and many central banks have moved slowly to embrace the idea, while China has proceeded with pilot-program tests of a digital yuan. (Read More)