Recent comments from Jerome Powell, President of US Federal Reserveshow that the US government is not particularly concerned with speed in developing a central bank digital currency (CBDC). In contrast, Anthony Pompliano, co-founder of Morgan Creek Digital, argues that time is of the essence.
“They’re talking about maybe developing one in the next few years,” said Pompliano of Powell’s recent comments on CBDCs. “This is not a thing for the next few years”Pomp said on an episode of his October 19 YouTube show: Meal money.
“This is something that is happening right now, and if they don’t act, the United States will fall way behind China because it all boils down to accessibility.”
Powell emphasized the importance of accuracy versus speed in issuing a CBDC during a discussion on cross-border payments on October 19th. “We haven’t made a decision to issue a CBDC and we believe there is still a lot to be done.”Powell placed more emphasis on building a CBDC properly than winning the race for digital currencies.
In the meantime, China is pushing ahead with its CBDC goals and has already started testing its digital yuan.
Pompliano explained the importance of accessibility. “If I am anywhere in the world and can have an internet connection and I want global currency, can I get the yuan or the dollar?”, he showed. Based on Pompliano’s comment, people might be inclined to go for the simplest solution that China’s CBDC could be if it becomes the dominant digital option before the United States comes into play.
Pompliano came for an interview with CNBC in September 2019 expressed the importance of a digital US dollar. After a year of interest in CBDCs from numerous countries around the world, Pompliano’s comments remain relevant.