Deliberations on the Digital Dollar:
A Letter to the Digital Dollar Project Regarding its Proposal for the United States to Develop a CBDC
On Friday, the Chamber of Digital Commerce sent a letter to the Digital Dollar Project regarding its whitepaper promoting the development of a U.S. central bank-issued digital currency (CBDC).
Our letter, developed carefully by the Chamber’s diverse membership including companies that would be instrumental in designing, creating, distributing, and promoting the implementation and use of the digital dollar, underscores why the development of a U.S. CBDC must be deliberate for it to be successful, as the impact of this Project will shape the U.S. and global financial services landscape. It highlights important considerations that will be fundamental in determining the digital dollar’s success, thoughtfully examining how a U.S. CBDC will facilitate, for example, access to financial services and enhance AML compliance while balancing privacy objectives. Importantly, the letter identifies areas within the financial system that can benefit the most from this Project, noting areas that are ripe for pilot programs to test the digital dollar’s use.
The development of a tokenized digital dollar promotes the need to modernize the United States’ payments infrastructure, combining the benefits of distributed ledger technology (DLT) enabled payments, such as increased settlement speed and decreased transaction costs, with the U.S dollar, the world’s reserve currency. In addition to contemplating the potential impact of the digital dollar, we encourage the Digital Dollar Project to work with government and industry on testing CBDC prototypes in a series of pilot programs. This need is urgent given the extraordinary developments across the globe, including the imminent launch of China’s digital yuan and efforts underway within the European Union and many other central banks, and the issues noted in the whitepaper and our letter deserve careful analysis.
We are thankful to DLx Law, in particular, Lewis Cohen, Angela Angelovska-Wilson, and Greg Strong, for their insights and expertise in responding to this important and timely Project.