Cryptocurrencies have been facing trouble with the governments and to fight this, many governments have moved in the direction of developing their digital currency. The launch of Libra has driven many central banks to discuss the possibilities and pros-cons of developing their digital currencies.
Two U.S. lawmakers, Rep. French Hill (R-Arkansas) and Rep. Bill Foster (D-Illinois), have asked Fed Chairman Jerome Powell to consider developing their digital dollar. The Congressmen expressed their concerns about how the U.S. dollar could be at risk because of the wide adoption of digital fiat currencies.
According to the Bank of International Settlements(BIS), about 40 countries have developed or are planning to develop digital currencies. China’s central bank has developed its digital currency which is expected to launch in early 2020.
The Congressmen also mentioned how the development and launch of Facebook’s Libra would lead to the risk of loss of control over the monetary policies. Hill and Foster have requested answers to several questions.
Last year, the former chair of the US Federal Deposit Insurance Corporation(FDIC), Sheila Bair also suggested the Fed give a try to developing their digital currency. The central bank, on the other hand, has decided to launch an instant payments network that would rival Wall Street’s banks.