The Fed's Brainard says the exploration of the digital dollar is increasing

Written by Jonnelle Marte y Howard Schneider

(Reuters) – The Federal Reserve governor said the Federal Reserve is ramping up its analysis to explore the potential development of a digital version of the dollar, at a time when more consumers are making digital payments and other governments pushing their own digital currencies. Lyle Brainard on Monday.

As the holder of the world’s reserve currency, the United States should be deeply involved as digital payments become more common and other countries develop digital currencies that can be used to send money across borders.

“The Federal Reserve is intensifying its research and public participation in a digital version of the dollar,” Brainard said in remarks prepared for a virtual event hosted by CoinDesk.

Brainard said the central bank should also anticipate changing consumer trends and ensure Americans have access to “safe central bank money” as digital payments increase in popularity.

Brainard warned that the increasing availability of digital payment options from private companies also threatens to “fragment” the payment space in a way that could create friction and hamper some consumers.

Brainard said major policy and technology issues will need to be addressed before the US government can move forward with an inclusive and secure digital currency.

He added that lawmakers will also need to strike a balance in developing a digital currency that provides privacy to families while preventing illegal activities.

(Edited in Spanish by Carlos Serrano)

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