The U.S. Federal Reserve (Fed) has <a href="https://www.fnlondon.com/articles/fed-plans-to-assess-the-risks-of-issuing-a-us-digital-currency-20211004" target="_blank" rel="nofollow noopener">planned</a> as early as this week to launch a review of the potential advantages and risks of issuing a US digital currency as the Central Banks around the globe experiment with the potential new form of money. It should be noted that at present, the Fed officials are having different thoughts on the matter, making it highly unlikely for a decision to come soon.
<h2>Fed to Evaluate US Digital Currency and Risks Associated with It</h2>
Dissimilar to Bitcoin, a <a href="https://www.cryptoknowmics.com/news/fed-reserve-to-take-another-step-towards-digital-currency-development/">Fed version</a> is going to be issued by and backed by the Central Bank of the United States, a government body, as are the US paper dollar bills and coins. 

As per the advocates, the Fed Digital Dollar could make it faster and even more cheap to move money around the financial system, bring into it people who are not having access to bank accounts and provide an effective way for the government to disperse financial aid.

Lael Brainard, the Federal Governer, said:
<blockquote>“It’s just very hard for me to imagine that the US, given the status of the dollar as a dominant currency in international payments, wouldn’t come to the table in that circumstance with a similar kind of an offering.”</blockquote>
<h2>Jerome Powell and Randal Quarles on Federal Backed Digital Assets </h2>
In addition to this, it should be noted that the Fed Chairman, <a href="https://www.cryptoknowmics.com/news/u-s-fed-will-publish-paper-on-cbdc-soon-jerome-powell/">Jerome Powell</a>, has given indications that he witnesses reason for caution and he along with other Fed officials has said that the research of Fed is early and investigative. He said:
<blockquote>“It’s our obligation to do the work both on technology and on public policy to form a basis for making an informed decision.”</blockquote>
The point man of the Central Bank, Randal Quarles has expressed more cynicism about the requirement for a Fed digital currency and said:
<blockquote>“Before we get carried away with the novelty, I think we need to subject the promises of a CBDC to a careful critical analysis.”</blockquote>

Fed Evaluates the Risks Associated with the Issuance of a US Digital Currency

Fed to launch a review of the advantages and risks of issuing a US digital currency as the Central Banks experiment with the potential new form of money.

Sahaj is an aspiring journalist with a keen interest in cryptocurrency and the whole concept of Blockchain technology. He is positive about the future potential of Cryptocurrency and Blockchain in shaping the world of finance for good. At present, he is covering the latest developments in the field of the cryptosphere.

Fed Evaluates the Risks Associated with the Issuance of a US Digital Currency

Top Picks