August 17, 2020
According to a recent report, the Federal Reserve Bank of Boston has been working with the Massachusetts Institute of Technology (MIT) to discover the likelihood of issuing its cryptocurrency. One of the initial steps will be developing the software that would be capable of addressing the needs of America’s 328.2 mil population.
The Bitcoin and Fiat Combination
Jim Cunha, the Boston Fed’s senior vice president, says that they have a forward-looking approach to working on its digital currency:
“We’re not building this for tomorrow; we’re building this for future years.”
Back in January, MIT researchers developed their cryptocurrency that is fixated to Vault that is aiming to solve the scaling problem that continues to regulate the development within the cryptocurrency space.
Together with Robert Bench, the Fed’s Assistant vice president and the MIT’s blockchain engineers, Cunha will work to explore the ins-and-outs of the bleeding-edge technology:
“We’re really trying to understand what the technology can offer and if it’s a path we’d like to go down”.
The central bankers find Bitcoin’s security very captivating, which is why they want to combine its properties with dollars and cents.
According to reports, the New York Federal Reserve considered Bitcoin as fiat money back in June, drawing derisive criticism from the cryptocurrency community.
The stakes are “way too high”.
Despite being at the forefront of the internet boom, the U.S. is lagging behind China when it comes to digitalization as the latter is already close to rolling out its DCEP digital currency.
Bench claims that the stakes are way too high when it comes to the U.S. dollar, the global reserve currency. He states that the procedure of accepting new technologies has to be fast but careful.
Last week, the governor of the U.S. Federal Reserve, Lael Brainard, revealed that they’d been experimenting with a digital dollar for the last several years.
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