According to this article, in a bill introduced in the US House of Representatives, the foundation of the digital dollar has been placed. The bill is called the "Digital Asset Market Structure and Investor Protection Act". The bill is to provide regulation for cryptocurrency and , in addition, allow the Federal Reserve to create and distribute digital dollars.

By law, the Federal Reserve does not create money. It only manages indirectly. It is the private sector the one who is able to create most of what we use as money in the banking system. They achieve this by issuing credit to the market. The new law (if approved) would allow the Federal Reserve to be able to create digital dollars (Federal reserve notes).

Blockchain technology would be the technology most likely used to handle this digital currency. It can be created and the transactions recorded. The question is: Do we really want the Federal Reserve to become more powerful that it is now?

Reference

Thysse W., “US Congress Taking Revolutionary Steps Towards A Central Bank Digital Currency” (Decentralized Legal System, September 19, 2021), available on: https://decentralizedlegalsystem.com/us-congress-central-bank-digital-currency/

This post is intended to only raise awareness. In order to make actual financial decisions please contact your financial advisor and/or tax advisor prior to making the decision.

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