Washington, DC— Today, the National Security, International Development & Monetary Policy Subcommittee of the House Committee on Financial Services held a hearing entitled “The Promises and Perils of Central Bank Digital Currencies.”
Central Bank Digital Currencies (CBDCs) are a digital representation of paper and coin fiat currency and are monetary instruments that are direct liabilities of a central bank, making them distinct from both cryptocurrencies (e.g., Bitcoin, Ethereum) and other forms of digital money (e.g., money held by commercial banks). The United States is among those nations considering the use and design of a CBDCs. While no decision has been made by the U.S.’ central bank, the Federal Reserve announced in 2019 that it would analyze potential costs, benefits, and legal issues pertaining to a digital dollar.
“CBDCs have the potential to be the next great financial innovation but also present a complicated set of security, financial inclusion, and stability concerns,” said Subcommittee Chairman Jim Himes. “Both our allies and our geopolitical rivals are working seriously to develop these new instruments. We need to go into these conversations with our eyes wide open to both the benefits and the drawbacks of CBDCs. Today’s panel of experts provides a diverse set of views to highlight many of the challenges.”
Panelists for today’s subcommittee hearing included:
- Dr. Julia Coronado, President and Founder, MacroPolicy Perspectives
- Mr. Yaya Fanusie, Adjunct Senior Fellow, Energy, Economics and Security Program, Center for a New American Security
- Ms. Julia Friedlander, C. Boyden Gray Senior Fellow and Deputy Director, Atlantic Council
- Dr. Andrew Levin, Professor of Economics, Dartmouth College
- Mr. Robert M. Baldwin, Head of Policy, Association for Digital Asset Markets
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