As the Federal Reserve dives deeper into the digital currency spectrum, it sheds light on the key tasks Central Bank Digital Currencies (CBDCs) claim to discharge, as it reports to Congress.
In a bid to demystify the concept of CBDCs and foster a greater understanding, the Federal Reserve recently laid out the important roles they would play. CBDCs not only offer a safe and efficient mode for transaction, but they also strongly secure digital cash infrastructure. This comes at a time when the dynamics of payments are rapidly evolving, and the need for digital solutions is soaring.
As per the report, “not many people understand the ‘nuts and bolts’ of digital currencies and how they would fundamentally alter the way our financial system operates. However, it’s crucial to realize that the benefits that come with it are numerous.”
The Federal Reserve is committed to conducting an in-depth research and development work on CBDCs. In its report, it clearly stated that it views the digital currency development as a public-sector responsibility. It further stressed upon the need for adequate readability, accessibility and security to ensure the optimal possible implementation of CBDCs.
The report mentioned the Federal Reserve’s stance: “Development of a CBDC system would need to be clear in design, universally accessible, resilient and secure to have the desirable social benefits.”
CBDC: A Boon for Financial Inclusion
The potential of CBDCs to enhance financial inclusion deserves to be underscored. According to the Federal Reserve, they manifest an invaluable opportunity to better serve the sections of the population currently underrepresented in the financial system. CBDCs might ostensibly spearhead a revolution in financial egalitarianism and inclusion.
