Things To Come: The 'Fedcoin'

The Government Just Took this Big Step Closer to Controversial “Fedcoin”

From Birch Gold Group

We are living in strange times…

The debasement of the dollar continues, and according to a recent Sovereign Man piece, China is the main threat for that to get even worse:

Conflict with China is by far one of the single biggest threats to the dollar. So it’s worth paying attention to, because, as the last Cold War proved, it can escalate rapidly and persist for decades.

But there is another threat to the dollar that is being developed on our own shores – and by our own central bank.

Just six months ago, the idea of a centralized digital currency in the U.S. was discussed by officials as a mere plan. Fed Governor Lael Brainard went as far as to admit that it could eventually replace the dollar.

Fast forward to today, and in a speech titled “An Update on Digital Currencies”, Brainard is now suggesting that the plan could materialize much sooner than they had ever led us to believe.

From the speech, we get an idea of how far the Fed’s plan has come, now in the experimentation phase of development:

We have been conducting in-house experiments for the last few years, through means that include the Board’s Technology Lab, which has been building and testing a range of distributed ledger platformsto understand their potential opportunity and risk. This multidisciplinary team, with application developers from the Federal Reserve Banks of Cleveland, Dallas, and New York, supports a policy team at the Board that is studying the implications of digital currencies on the payments ecosystem, monetary policy, financial stability, banking and finance, and consumer protection.

“Distributed ledger platforms” describe the foundation on which a “Fedcoin” system could be built.

In collaboration with MIT, Brainard also noted that the Fed is now “live testing” a digital currency in a simulated environment to use “as needed”:

The Federal Reserve Bank of Boston is collaborating with researchers at the Massachusetts Institute of Technology in a multiyear effort to build and test a hypothetical digital currency oriented to central bank uses.

So while we likely won’t see “Fedcoin” next year, we are very clearly much closer to implementation.