Facing competitive pressures from both sovereigns like China and corporates like Facebook, the Fed has been exploring the digital dollar quicker than initially indicated. Interestingly, Powell indicated a fully public ledger of transaction records would not be a good fit for the US system.
"We have not decided to do this," he told Foster. "It is not -- there are many questions that need to be answered around a digital currency for the United States, including issues of, cyber issues, privacy issues, many many operational alternatives present themselves. And so we’re going to be working through all of that and doing that work thoroughly and responsibly. That conservative approach echoes past comments from Powell, who said last fall that consumers are not "clamoring" for central bank-backed digital currencies. Steven Mnuchin, the U.S. Treasury secretary, said in December that he sees little reason to aggressively push for a digital dollar. “Chair Powell and I have discussed this at length- we both agree that in the near future, in the next five years, we see no need for the Fed to issue a digital currency.”