You might call it the crypto conundrum: The more volatile the crypto markets, the more attention they get from regulators in the United States and abroad who are keen to pack down this burgeoning asset class. . But in doing so, regulators also unwittingly increase the likelihood that they will end up getting themselves into the crypto fray by developing – and deploying – their own central bank digital currencies (CBDCs).

To that end, Federal Reserve Chairman Jerome Powell indicated last week that he wanted more input on CBDCs.

Through a video press release, Powell said that “As the central bank of the United States, the Federal Reserve is responsible for promoting monetary and financial stability and the security and efficiency of the system. payment ”, and explained: functions that we are closely monitoring and adapting to technological innovations that are now transforming the world of payments, finance and banking. “

As has been widely noted, the central bank has studied the technological and policy implications of launching digital fiat money. Powell noted in the Thursday May 20 commentary that it is “important that any potential CBDCs can serve as a complement, not a replacement, for current private sector cash and digital forms of the dollar, such as deposits in banks. commercial. . Among the short-term efforts: The Fed will seek to publish a research paper related to the CBDC this summer.

The Boston Fed worked with MIT to research how a CBDC could be developed. And in an interview with Karen Webster, Jim Cunha, senior vice president of secure payments and FinTech at the Boston Fed, said issuing and scaling digital fiat would require interoperability between digital fiats. and the payment rails of the various central banks. He also said that CBDCs can be used to help unbanked and underbanked individuals and families. Details, via an MIT report, are expected to be released in July.

Digital and digital ruble won

In addition, the Bank of Russia, as reported by, is set to release a prototype digital ruble by the end of the year, according to comments from central bank deputy governor Olga Skorobogatova.

South Korea, through its central bank, the Bank of Korea, will soon submit a technology partner to launch a pilot program for a digital won, Reuters reported on Monday (May 24th). The digital currency trials are said to be in the planning stages.

The increased efforts of these and other countries come as Bank of International Settlements said earlier this year, around 86% of central banks are “actively researching” CBDCs, 60% have experimented with the technology, and 14% have deployed pilot projects.

Earlier in the month, Accenture and SWIFT, the provider of secure financial messaging services, released a joint document declaring that interoperability is essential to bring CBDCs to widespread adoption. As the document notes, “CBDC-based systems must coexist and be integrated with other payment systems. Different types of money are used in different payment systems today and these systems flexibly interoperate to support the flow of payments and the efficient use of liquidity.

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About the study: U.S. consumers see cryptocurrency as more than just a store of value: 46 million people plan to use it to make payments for everything from financial services to groceries. In the Cryptocurrency Payments Report, PYMNTS is polling 8,008 cryptocurrency users and non-users in the United States to examine how they plan to use crypto to make purchases, which crypto they plan to use. to use – and how merchant acceptance can influence merchant choice and consumer spending.

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