FedNow Payment Network: US Central Bank Dismisses Digital Currency Concerns

The U.S. Federal Reserve has responded to recent criticism of its Fednow payment service by asserting that it is not a digital currency and will not replace cash or any other form of payment. The Fed emphasizes that Fednow is solely focused on facilitating instant payments and is similar to other payment services it offers, such as Fedwire and Fed ACH. The central bank has also stated that it has not made a decision on whether to issue a central bank digital currency (CBDC) and will not do so without the authorization of the executive branch and congressional members. However, some critics argue that the Fednow service is a form of digital currency, and the exact nature of the project and its relationship to a potential CBDC remains a topic of debate. The White House’s recent “Economic Report of the President” notes the potential benefits of CBDC initiatives and acknowledges the existence of two distinct Federal Reserve CBDC projects, Project Cedar and Project Hamilton.

Clever Robot News Desk 10^th April 2023