Fed Governor Says ‘No Compelling Need’ for US Central Bank Crypto

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Lael Brainard, member of the board of governors in the U.S. Federal Reserve, doesn’t see a convincing need demonstrated to get a Fed issued electronic currency. Speaking at the Decoding Digital Currency Conference yesterday in San Francisco, California, Brainard said that, while main bank electronic currency might seem to address a number of challenges associated with cryptocurrency, they might not withstand closer scrutiny.” . Further, with individuals finding easier ways to exchange digital payments directly through cellular applications along with Other means, American consumers are likely to get numerous mechanisms for making electronic payments in real time. She noted: .

In the end, there’s absolutely no compelling demonstrated need to get a Fed issued digital currency” . Elsewhere in the speech, Brainard once more made it clear that she believes that cryptocurrency not to pose a threat to financial stability. She noted that the main bank is actively monitoring developments in cryptocurrency in places like obligations coverage, supervision and regulation, financial stability, monetary policy and more. Discussing security concerns with respect to cryptocurrency, such as breaches and fraudulent actions, Brainard said: But, the still relatively modest scale of cryptocurrency with respect to our broader financial system and comparatively restricted connections to our banking sector suggest that they don’t currently pose a threat to financial stability.” .

The governor continued to say that unfavorable changes in the cryptocurrency market may leads to extreme price fluctuations, trading problems or market breakdowns. To be able to prevent such actions, Brainard stressed that Fed Reserve will continue to monitor cryptocurrency as they develop, with particular vigilance for any sign of growing materiality in the wider financial system” . As noted, this not the very first time the Fed governor has spoken on the topic of cryptocurrencies. In Apr of this year, Brainard cautioned individual investors to be knowledgeable as to the possible disadvantages of those investments as well as the potential for reductions.

She said at that Time that Fed is tracking is the intense volatility evidenced by some cryptocurrencies.” . Lael Brainard picture via Shutterstock. The leader in blockchain information, CoinDesk is a media store that strives for the highest journalistic standards and adheres to a strict set of editorial policies. CoinDesk is an independent subsidiary of the Digital Currency Group, which invests in cryptocurrency and blockchain startups.

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