answering this question in mid-August when it finalized a framework for assessing which entities may be granted payments system access. Tis framework creates a tiered system for evaluating incoming requests, and under it, institutions that engage in novel activities would undergo a more extensive review.
Access to the payments system is a significant privilege and comes with many responsibilities. As the Fed begins evaluating new requests for access, we’ll be
watching carefully to ensure that these new guidelines are appropriately accounting for the inherent risks that come with some of these new financial players.
IS THERE A USE CASE FOR A CBDC? Finally, there’s the question of a central bank digital currency and whether there’s a use case for it in the U.S. As ABA told policymakers in several comment letters and testimonies over the last year, our view is that no such case exists — for every problem that proponents
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say a CBDC could solve, the fact is that there are already solutions available that don’t involve a government-created currency. Financial inclusion is just one example: banks are already making great strides to bring more unbanked households into the financial system by offering Bank On- certified accounts.
Not only would a CBDC be duplicative of private-sector solutions that already exist, but it also has the potential to have an incredibly damaging effect on bank balance sheets and the flow
of credit to households and businesses if the Federal Reserve were to become a competitor for bank deposits.
All of these ongoing debates underscore an urgent need for a fair, well-calibrated regulatory framework for digital assets — one that promotes responsible innovation while minimizing systemic risk and protecting consumers. And that’s a framework we’ll continue to fight for.
Email Rob Nichols at rnichols@
aba.com.
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