Jerome Powell, head of the US Federal Reserve, said state-backed digital currencies and official Central Bank Digital Currencies (CBDCs) can function alongside fiat money in the coming years, as per a report on business outlet Bloomberg on Thursday.
Powell made the comments in a prerecorded video to a payments conference in Basel, Switzerland, amidst a bigger institutional push for cryptocurrencies and Bitcoin in recent times.
CBDCs are theorized as fiat-backed stablecoins that are directly controlled and issued by the state. All transactions would be viewable on a blockchain and these are likely to serve as a faster, more traceable method of settling funds compared to cash. However, may not be as accessible or inclusive to use as Bitcoin or other ‘public’ cryptocurrencies.
