Fed conference hears stablecoins may boost USD as global reserve currency
A note published by the United States Federal Reserve on a recently held conference found a majority of exports believe a U.S. dollar central bank digital currency (CBDC) would not drastically change the global currency ecosystem.
Panelists at the conference also agreed CBDC development outside of the U.S. doesn’t threaten the status of the dollar, but th development of cryptocurrencies could alter the role of the dollar globally, with some saying stablecoins could even boost the U.S. dollar's role as the global dominant reserve currency.
The assessments came from expert panelists at a June 16 and 17 conference hosted by the Federal Reserve on the “International Roles of the U.S. dollar” collated into a note and published by The Fed on July 5. The conference was used to gain insight from policymakers, researchers, and market experts to understand “potential factors that may alter the dominance of the U.S. dollar in the future” including new technologies and payment systems.
A discussion on a panel addressing digital assets and if CBDCs would provide advantages for the dollar had panelists agree that the underpinning technology alone wouldn’t “lead to drastic changes in the global currency ecosystem”.
Speakers on the panel included digital currency initiative director at MIT, Neha Narula, head of research at the Bank of International Settlements, Hyun Song Shin, chief investment strategist at asset management firm Bridgewater, Rebecca Patterson and HSBC bank’s head of FX research Paul Mackel.
The panelists agreed that factors such as market and political stability, along with market depth, are more crucial for dominant reserve currencies like the U.S. dollar that the development of a Fed issued digital dollar.
The development
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