President-elect Donald Trump’s pick for Treasury Secretary does not think that the US needs to launch a central bank digital currency (CBDC).
During his nomination hearing on Thursday, Scott Bessent told the Senate Finance Committee that, unlike other countries, the US will not gain much from rolling out a digital dollar.
“On CBDCs, I see no reason for the US to have a central bank digital currency. In my mind, a central bank digital currency is for countries that have no other investment alternatives.”
A CBDC is a digital form of a country’s fiat currency, regulated by a central bank.
Bessent says that holders of other currencies, particularly the Chinese yuan (CNY) or renminbi (RMB), have little to invest in. He says this is not the case with the US dollar.
“Many of these countries are doing it out of necessity whereas the US, if you hold a US dollar, could hold a variety of very secure US assets.”
In 2022, the Federal Reserve issued a discussion paper that examined the pros and cons of a potential CBDC, but the central bank to date has not made any decision to implement a digital dollar.
Trump neither supports the idea of pursuing a CBDC. Last year, he told a crowd in New Hampshire that he would block the creation of a central bank digital currency.
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