The US Treasury Department has revealed it is planning to advise the government to issue a digital dollar.
According to PYMNTS, however, it will only officially sign off the dollar if there is a government signal that it is in the national interest.
CoinDesk noted that the question of national interest will come down to specifics from the Biden administration as well as possible action by Congress.
PYMNTS cited an executive order from President Biden earlier this year that called for crypto recommendations from numerous corners of the federal government.
There’s expected to be a document from the Treasury on how to handle the digital dollar in the next few days. It’s eagerly awaited, PYMNTS remarked, because issuing the token could have big implications for how customers deal with traditional banks.
However, Jerome Powell – chair of the Federal Reserve – as well as other senior officials have said the central bank wouldn’t issue anything official without support from the administration and Congress.
According to Fed Vice Chair Lael Brainard, even if Biden, Congress and the Fed come to a decision, it might take as long as five years to design and launch one, which would give the crypto industry time to establish alternative, private stablecoins.
Almost half a trillion dollar has been wiped from the valuation of FinTech companies, according to a report from the Financial Times.
It stated that over 30 FinTech companies has listed in the US since the start of 2020. While the pandemic highlighted an opportunity for digital services, the rising interest rates and lack of profits have impacted the initial excitement.
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