Kevin Warsh, former governor of the US Federal Reserve Bank, thinks that a possible ‘FedCoin’ production, which will transfer legal actions to a digital coin, should be seriously considered.
Kevin Warsh managed the Fed from 2006 until 2011. When Trump administration appointed Jerome Powell to the Fed, Warsh was among the ambitious candidates. Warsh said that if he were appointed once more, he would have created a team to work on the idea of FedCoin which would help to “bring legal activities into a digital coin”.
According to Warsh’s rhetoric, many central banks find these cryptocurrencies as intelligent, but they are trying to be cautious about the losses that investors might experience and the frauds in the sector. Warsh also emphasized the Federal Reserve’s benefit from Blockchain technology, especially within payment systems.
According to Warsh, trillions of dollars could be transferred between banks with the help of Blockchain technology.
Jerome Powell, the current Fed governor, commented on this technology and said that Blockchain could be a valuable asset of use for the economy’s wholesale payments.
According to Warsh, if people believe that cryptocurrency is indeed the future of money, then central banks need to stop viewing cryptocurrency as something new.
Currently there are some central banks which proceed with studies and tests on decentralized ledger technology. The Bank of England announced that it is conducting a proof-of-concept study to understand whether the renewed Real Time Gross Settlement (RTGS) service could be applicable with blockchain technology.
The European Central Bank and Bank of Japan conducted a study on the potential of blockchain to transform privacy and security settlements. In the past days, South Korea’s central bank has announced that it is considering cryptocurrencies and blockchain technology for a “cashless society” project.
