As of recently, the Federal Reserve has been mentioning cryptocurrencies and their potential impact on the economy. The Fed Governor Lael Brainard is one of the latest to comment on the situation in which digital currencies currently are.
According to Brainard, the cryptocurrencies must offer more details and all the things they need in order to solve the challenges on the market. Brainard spoke at a Fed conference in San Francisco. As Reuters reports, she stated:
“Cryptocurrencies are strikingly innovative but also pose challenges associated with speculative dynamics, investor and consumer protections, and money-laundering risks.”
Earlier this week, the St. Louis Federal Reserve Bank President showed up at the Consensus 2018 conference in New York and once again proved that authorities are more than eager to involve in the current happenings.
However, the Fed currently thinks that the risks outweigh the rewards. According to Brainard, the blockchain that is being used to streamline payments is very innovative – but digital currencies are “problematic” due to the lack of centralized control and the vulnerable position that consumers and investors can be placed in as a result.
What’s interesting is that Brainard placed a nail in the coffin for the possibility of a Fedcoin which would be a cryptocurrency that will ‘keep the pulse on the market’. As she said:
“There is no compelling demonstrated need for a Fed-issued digital currency,”
The Fedcoin would usher in “legal activities into a digital coin” however isn’t evident in the current Fed regime.
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