Christopher Giancarlo, former chairman of the Commodity Futures Trading Commission (CFTC), believes that it is time for the Federal Reserve Bank to issue a fully digital currency.
Giancarlo said on “On the Move”-on Yahoo Finance that the Federal Reserve must issue a digital currency to compete with the digital currency of the Chinese Central Bank (CBDC).
The former CFTC chairman stressed that online shopping could benefit from a digital payment option in the US, as there are no intermediation fees like with traditional debit and credit cards. Giancarlo added:
“When we talk about a digital US dollar, it should provide the same immediacy of payment in the digital world as the analog world of people.”
Digital dollar could become the equivalent of Bitcoin.
Giancarlo believes that a digital dollar would be agnostic to other initiatives in the crypto area. He said Bitcoin and innovations like Facebook’s Libra had their own “value propositions” and could coexist with a central bank issued digital currency (CBDC). He said:
“I think the market always works better when there’s a lot of competition… An instrument like Bitcoin could serve as the equivalent of the digital dollar and be equivalent to a form of digital gold.
Giancarlo also argued that the US regulatory framework must adapt to the changes that cryptographic currencies bring to financial institutions. He said:
“This is going to change things dramatically and our laws have to evolve as they have done in the 90 years, now they have to evolve again”.
As Cointelegraph reported, Giancarlo is involved in a digital dollar project supported by global consulting giant Accenture. Accenture is to work with the Swedish central bank on its own digital currency, the so-called e-Krone. This project was originally launched by Giancarlo with the aim of setting up a non-profit foundation to study the prospects for converting the dollar into a “fully electronic currency based on block chains”.
The Cointelegraph reported earlier this month on US Congressman Bill Foster (D-IL), who questioned Federal Reserve Chairman Jerome H. Powell on the progress of the CBDC in the US at a monetary policy hearing.
He referred in particular to China’s plan to introduce the digital yuan among countries involved in the Silk Road initiative and that this could jeopardise the status of the dollar as a world reserve currency.