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The Fed's Wary Embrace of Digital Dollars

It is not difficult to fathom why the United States’ central bank is especially resistant to any quantum change in the existing financial system. But while policymakers' reluctance to rush into launching a digital dollar is understandable, that is no excuse for the slow pace of cryptocurrency regulation.

CAMBRIDGE – Many countries’ governments, most notably China’s, are continuing to experiment with central bank digital currencies (CBDCs). Money 3.0 is moving full speed ahead, and with its recent white paper, entitled “The US Dollar in the Age of Digital Transformation,” the US Federal Reserve, a conspicuous laggard, has finally started to weigh in, if only tepidly. The Fed’s caution is understandable, but is it excessive?