Former adviser to the president of the United States of America on, Tim Morrison has said the US should do all it can to stop a digital yuan. He said this because now, central bank digital currencies (CBDC) are going to show the soft power might of global superpowers. The US has been the global economic power, with the dollar as its reserve weapon and China’s CBDC leads the revolution.
Morrison who is currently a fellow at the Hudson institute revealed this in an op-ed in Foreign Policy detailing a “digital makeover” for the US dollar in order to prevent China’s CBDC from getting “ahead on cryptocurrency.”
Reportedly, in October 2019, Mark Zuckerberg, Facebook CEO while defending Libra before the United States Lawmaker presented the digital currency as that of the US and said the Congress should not let China beat them to it.
Zuckerberg called Libra an “American invention” and canvassed for its approval.
As Libra was being grilled by regulators, Bitcoin and other cryptocurrencies alike took some hits. President Trump referred to crypto as “based on thin air,” Federal Reserve chairman Powell criticized digital assets and Treasury Secretary Steven Mnuchin called it a “national security issue.”
Morrison, as he agreed with Mnuchin’s “quite correct” assessment added that digital-innovation must firmly be with the US. He said, “The emerging revolution of digital currency is a national security issue. But the problem is that his approach to digital currency may drive innovation into the hands of the United States’ leading national security competitor: China.”
With the US dominating world economy, as the dollar is used as a global reserve, Morrison explained if Washington were to “finance its profligate fiscal responsibility,” the “first to suffer” would be the US Military.
Proposed digital dollar, Matters arising
Jerome Powell, Federal Reserve Chairman agreed that the central bank is looking at the potential of a Central Bank Digital Currency CBDC. While the Fed has not created its own crypto, it is continuing to “carefully analyze the costs and benefits of pursuing such an initiative in the U.S.,” Powell said in a letter to lawmakers in November.
Meanwhile, Christopher Giancarlo, former chairman of the Commodity Futures Trading Commission (CFTC), set up an organization to look into the framework and potential of a digital dollar and remains an advocate of the US issuing its own dollars.
“If it (U.S. dollar) remains an analog currency the challenges of using it in a digital world are very complex,” he added.
“What we are proposing is a digital form (of that dollar) that would be minted by the central bank … And it would be made available to users through the traditional banking system and other banking enterprises,” Giancarlo said.
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