Crypto analysts have a reputation for making claims that can sometimes be completely spot-on, or very inaccurate. However, the individual predictions often come down to the analysts themselves, not the claim that they are making.
And while some are fixating on when Bitcoin will rally, others are focusing on the more likely possibility of there being a Digital Dollar. More specifically, analysts are saying that a digital US dollar backed by the Central Bank is not just possible, but it is inevitable.
Although the timeline for when this digital currency will come out is still many years off, the chances of it coming have increased exponentially. One of the major signs that are pointing to this has been how the US has taken a more active interest in regulation, which means that it may offer a state-backed alternative.
A Better Understanding of Cryptocurrency and Policy
One of the major reasons why government agencies have started to warm to the ideas of cryptocurrencies is because of Joe Biden’s most recent executive order. The newest order issued by the presidential office instructed that multiple government agencies work on developing reports about crypto policy.
During this time, not only have these agencies become more familiar with how cryptocurrencies work, but they have also become more welcoming to them. Therefore, it is safe to say that the US could even start working on its own unique decentralized cryptocurrency backed by the Central Bank.
A CBDC Would Offer the US Government Agencies Plenty of Benefits
It is fairly obvious to say that having a central bank digital currency or a CBDC can radically change how people inside and outside the US interact with money. Along with offering a range of other benefits, it will especially offer the Federal Reserve and the Treasury even more freedom over their transactions. And if recent political changes are anything to go by, the US government is very much open to the idea.
A CBDC is Already in Development
The US central bank released a paper recently that focused on the US dollar, specifically during the age of digital transformation. The paper went into great depth exploring what it would be like to have a decentralized digital national currency. The paper, also mentioned that it is exploring the options and implications to issue a CBDC.
Those looking into how a CBDC would work just go to show how well they actually understand how something like a CBDC would work. They have been open about how they are looking into CBDCs from every angle, which likely means that they have already developed something resembling a cryptocurrency.
Although it is still a long way away from release, it is very likely that the findings of this project will be interesting to read about.
