About the Federal Reserve Bank of Boston, CBDC
Federal Reserve Bank of Boston (FRB) President Eric Rosengren said yesterday that the issuance of the Central Bank Digital Currency (CBDC) will require further investigation. The Federal Reserve Bank of Boston has been collaborating with the Massachusetts Institute of Technology (MIT) and the CBDC since last summer.
Governor Rosengren, who attended an online event at Harvard Law School, described the ongoing CBDC research as “research-oriented research.” He said that in order to actually implement CBDC, it is necessary to consider various factors as well as technical feasibility and implementation method.
Governor Rosengren cites the benefits of the CBDC as improving financial inclusion, lowering transaction costs between borders, and giving “flexibility” to the introduction of monetary policy.
Meanwhile, Federal Reserve officials have warned that the policy implications and trade-offs of the introduction of digital currencies should be considered.
Governor Rosengren also said:
We need to understand what problems the CBDC is designed to solve, and whether other technologies can solve the problem cheaper or more efficiently.
Announcement of joint research
The Federal Reserve Bank of Boston has been collaborating with MIT’s Digital Currency Initiative and the CBDC since August last year. We are conducting research on a prototype of the “digital dollar” and plan to announce the research results around 3Q 2021 (July to September).
When the research results are announced, the project code etc. will be released. James Cunha, head of the Federal Reserve Bank of Boston, had previously told Bloomberg that the study remained neutral to US government policy and “intentionally intended to show what is technically possible.”