Bitcoin is free speech

Several digital dollar pilot projects planned in the US

In the US, several pilot programs for one digital dollar are scheduled to start over the next twelve months. A total of five such projects would be launched during the period to investigate the possible advantages of a digital central bank currency (CBDC), the private sector initiative, Digital Dollar Project, announced on Monday. This is a partnership between the management consultancy Accenture and the Digital Dollar Foundation, a non-profit foundation. The initiative was launched last year to support research on a digital currency in the USA.

Fed carefully

There are CBDC conferences around the world and new articles appear every week based on data from other countries, said Christopher Giancarlo, co-founder of the Digital Dollar Foundation. "What there isn't is any real world data and tests from the United States to fuel the debate," he said. This data should now be generated.

Central banks around the world are currently exploring the possible introduction of digital versions of their currencies. Because the digitalization of payment transactions is advancing and the use of cash is declining in many countries. Central banks are therefore under pressure not to lose touch with technological developments and possibly the currency sovereignty of large technology groups. Like banknotes and coins, CBDCs should also be an easy-to-use legal tender, just in digital form.

In the United States, the central bank had so far been rather cautious on the subject. The Federal Reserve is currently working with the Massachusetts Institute of Technology (MIT) based in Cambridge near Boston on a technology for a possible e-dollar. It is much more important to get it right instead of being quick, said Federal Reserve Chairman Jerome Powell just last week.

Publish quickly

According to Giancarlo, Powell is correct in his caution. But as China leads the way in central bank digital currencies, the US must ensure in the debate that values ​​such as the preservation of privacy, free trade and freedom of speech are taken into account in development. Three of the pilot programs are scheduled to start in the next two months. They are intended to complement the Fed's MIT project and provide data, among other things, on the functioning and use of a digital dollar. These should also be published quickly.

Accenture has worked on a number of CBDC projects, including in Canada, Singapore and France. In the euro zone, the European Central Bank wants to decide around the middle of the year whether it wants to give the green light to the e-euro project. (REUTERS, May 3rd, 2021)