Federal Reserve Governor Slams Crypto and CBDCs as Excessively Hyped Technologies
US Federal Reserve Governor Christopher Waller has questioned the efficacy of bitcoin and the United States’ need for a central bank digital currency (CBDC).
While addressing at a session on CBDCs, the governor refers to crypto as “electronic gold” since it may be used for wealth storage.
He proceeded by comparing cryptocurrency to paintings and baseball cards, which individuals purchase with the goal of earning a profit.
Still commenting on the business, the Governor indicated that he believes blockchain technology is overhyped.
According to him, blockchain is not the most effective method of doing business. As he put it, We are aware that distributed ledger blockchain technology is one method of conducting transactions and maintaining records, however it is inefficient.
It’s worth noting that the Federal Reserve Governor is not alone in his thinking, since blockchain technology has been dubbed the next big thing in the technological world.
Governor Waller also expressed his reservations about CBDCs. He claimed that there was no compelling need for it, since the purpose is to speed up payments, which is already accomplished by many banking systems.
Additionally, he challenges the necessity for the Federal Government to process payments and provide payment services when banks can do so. Additionally, he said that CBDC research articles should be seen as infomercials, given the associated loudness and hype.
Will the United States Adopt a CBDC?
Though the US is currently dragging its heels on implementing a CBDC initiative. Numerous central banks worldwide have created their own national digital currencies, with China leading the field with its Digital Yuan initiative.
According to some commentators, the US government’s refusal to establish a CBDC project might result in the nation falling behind countries like Japan, China, and others who have made significant progress.
However, Waller takes a contrary viewpoint on these assertions. According to the Federal Reserve Governor, retail access to the Digital Dollar by people of other nations would jeopardize their national currencies, since “any currency backed by the dollar contributes to the amplification of US monetary policy.”
Recently, Federal Reserve Chairman Jerome Powell acknowledged that the institution is still undecided about whether to establish a CBDC.
Powell, on the other hand, acknowledges that digital innovation has arrived and that new laws, rules, and standards are required to meet it.