According to the Federal Reserve of the United States, most banks don’t care about crypto —but a possible CBDC is a big discussion topic.
Inflation is raging in the United States, and banks are looking for solutions to cope with this crisis. Still, crypto is not on the radar of financial strategists just yet.
On July 15, the U.S. Federal Reserve Board shared the results of a survey conducted on the nation’s largest banks to learn about their interests and expectations in cryptocurrency-related financial products and services.
The results show that more than 66% of the 80 CFOs that participated in the study agreed that implementing Distributed Ledger Technology (DLT) and cryptocurrency or decentralized finace products was not a priority to achieve greater economic growth and development —at least not in the short term.
“When asked about the expected impact of DLT or crypto-related products on their bank’s liquidity management practices in the next 2-5 years and 5-10 years respondents generally reported that their bank does not see these technologies as having large effects on liquidity management,”
However, for a quarter of respondents, the blockchain and other distributed ledger technologies were considered a medium to high priority when asked about strategies to improve their infrastructure.
Most banks do not expect DLT or crypto-related products to impact their liquidity management practices in the next 2-5 years and 5-10 years. However, respondents said they are “actively monitoring the situation and will adapt to the landscape as needed.”
So, most banks are not really turning a blind eye to cryptocurrencies but are being cautious, especially in this time of regulatory and economic uncertainty.
On June 17, Jerome Powell, chairman of the Fed, said during a conference in Washington that the Fed is considering launching a CBDC to be on par with the growth of the crypto ecosystem.
“In light of the tremendous growth in crypto-assets and stablecoins, the Federal Reserve is examining whether a U.S. central bank digital currency (CBDC) would improve on an already safe and efficient domestic payments system.”
Powell added that a CBDC could help “maintain the dollar’s international standing.” So, while there is no tentative launch date for a digital dollar, regulators are already talking about the benefits of digital currencies and decentralized technologies so as not to lose the power granted by the U.S. dollar.
The Fed’s indecision about launching a CBDC has caused the U.S. to lose the race against China on this field. The Asian giant has its own CBDC project almost ready for national adoption, and according to the government, the massive tests have been very successful.
Felix got into Bitcoin back in 2014, but his interest quickly expanded to everything blockchain-related. He’s particularly excited about real-world applications of blockchain technology. Having worked as a professional content writer for three years before that, Felix transitioned to working on blockchain-centered projects and hasn’t looked back ever since.
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