From PYMNTS.com, April 18:
It’s unlikely that the benefits of a central bank digital currency (CBDC) would be greater than the potential risks.
So said Federal Reserve Governor Michelle W. Bowman on Tuesday (April 18) during a speech at Georgetown University.
“From my perspective, there could be some promise for wholesale CBDCs in the future for settlement of certain financial market transactions and processing international payments,” Bowman said.
“When it comes to some of the broader design and policy issues, particularly those around consumer privacy and impacts on the banking system, it is difficult to imagine a world where the trade-offs between benefits and unintended consequences could justify a direct access CBDC for uses beyond interbank and wholesale transactions,” Bowman added.
Noting that it remains imperative to study the potential for a U.S. CBDC, Bowman said there are several instances in which it’s likely a CBDC would not be the best solution for a problem.
For example, while some look to CBDCs to make payments faster while reducing cost and friction, these goals can be accomplished with the upcoming launch of the Federal Reserve’s FedNow Service, Bowman said.
Others speculate that a U.S. CBDC could improve financial inclusion, but 95% of U.S. households have at least one member with a bank account, and the remainder are unbanked because they don’t want a bank account or they don’t trust banks, Bowman said....
....MUCH MORE
