Federal Reserve Chairman Jerome Powell said a preliminary Fed report on central bank digital currencies (CBDCs) will be released in early September during a Wednesday hearing before the US House of Representatives Financial Services Committee.

Jerome Powell – Chairman of the Fed

In response to a question from rating member Patrick McHenry (RN.C.), Powell said The report will outline the benefits and risks of CBDCs, as well as cryptocurrencies and stablecoins in general. During the hearing, Powell reiterated that stablecoins need regulation if they are to play an important role in US payment networks.

“Stablecoin certainly has some advantages in terms of a faster payment system and has some of the characteristics of CBDC, but there are some risks with it at the moment. I think the point is that stablecoins are a lot like money market funds or bank deposits or a shrinking bank. “

Powell had previously said the report would be released in July.

The Boston Federal Reserve Branch announced last year that it was conducting a study of the requirements for CBDCs for use in the United States and is expected to publish the document.

In response to a question from Rep. Stephen Lynch (D-Mass.) Powell added that the status of the dollar as a world reserve currency would not be jeopardized even if other nations develop CBDC.

The chair also added that digital currencies can replace decentralized digital assets.

“You wouldn’t need stablecoins, you wouldn’t need cryptocurrencies if you had American digital currency, I think that’s one of the strong arguments for that.”

Annie

According to Coindesk

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