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The digital dollar will be a CBDC and will not depend on the blockchain, according to the former head of the Federal Reserve in Boston

The digital dollar will be a CBDC and will not depend on the blockchain, according to the former head of the Federal Reserve in Boston

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Answer The digital dollar will be a CBDC and will not depend on the blockchain, according to the former head of the Federal Reserve in Boston

Eric Rosengren, former president of the Federal Reserve Bank of Boston, made a public statement explaining the concept of a central bank digital currency (CBDC) for the United States of America.

He was told that the blockchain would not be involved in making a digital dollar.

Rosengren commented on the potential of a US CBDC, noting that it will exist in the future.

He also said that it would require an agreement between the White House, Congress and the Federal Reserve, and it could take a long time.

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Rosengren explained that CBDCs will be exclusive.

According to Rosengren, blockchain technology is insufficient for CBDC needs, because we want to have sufficient throughput and transaction speed so that the blockchain does not have an effective mechanism to satisfy the kind of operational needs that we think we will need.

Instead, Rosengren believes that a US central bank digital currency will be closer to existing digital money transfer systems.

Rosengren has extensive experience working at the Federal Reserve Bank of Boston, having started his career there in 1985.

He became Chairman of the Boston Federal Reserve in July 2007 and performed his role for more than fourteen years before retiring on September 30, 2021, so Rosengren was present in his position from the inception of Bitcoin until he left his position recently at the age of 64.

The Federal Reserve is exploring the possibility of digital currencies for the Central Bank of the United States:

These latest comments from Rosengren are based on an as-yet-unpublished research paper, a joint effort between the Massachusetts Institute of Technology and the Federal Reserve Bank of Boston.

According to “Jerem Powell,” this upcoming paper will contain an examination of the costs and benefits of central bank digital currencies, or CBDCs.

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While a solid yes or no answer from the Fed has yet to be provided, Powell explained that his institution is currently working proactively to assess whether to issue a central bank digital currency, and if so, in what form.

This means that the United States is one of the most recent countries to explore the possibility of launching a CBDC after development efforts have now been launched by other countries such as South Korea, Nigeria and New Zealand.

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