Fed Chairman Powell: We Will Engage the Public on the Digital Dollar This Year

Nearly every time an elected official has asked U.S. Federal Reserve Chairman Jerome Powell about the digital dollar, he’s emphasized caution and risk to the stability of the U.S. financial system.

Wednesday, however, Powell went further while speaking before the House Committee on Financial Services, saying the U.S. central bank would “engage with the public” on the digital dollar this year, giving a timeline to the central bank digital currency’s development for the first time.

“This is going to be an important year,” Powell said of the digital dollar project. “This is going to be the year that we engage with the public pretty actively including some public events that we are working on, which I’m not going to announce today.”

Powell emphasized that the Fed won’t make decisions and then present them to the public, but will rather talk with Americans about the tradeoffs involved with the digital dollar project. 

“There are both policy questions and technical questions that relate between those two and they’re very challenging questions,” Powell said. “We’re going to have a public dialogue … in the meantime we’re working on technical challenges and also collaborating and sharing work with other central banks around the world.” 

Beating a familiar drum, Powell also emphasized that the central bank would be careful about designing a digital dollar that doesn’t “undermine … healthy market function.”