Law Decoded: When central banks seek public discussion, Jan. 17–24
Last week, two central banks dropped public reports that can have a sizable impact on the crypto landscape in their respective countries and beyond. The U.S. Federal Reserve published a discussion paper entitled “Money and Payments: The U.S. Dollar in the Age of Digital Transformation,” which summarizes years of the Fed’s research on CBDCs. Meanwhile, the Central Bank of Russia released a report that called for a blanket ban on domestic cryptocurrency operations and mining. Both documents are framed as an invitation for public discussion, but the kinds of discussions that they will trigger are likely to be very different.
Below is the concise version of the latest “Law Decoded” newsletter. For the full breakdown of policy developments over the last week, register for the full newsletter below.
The authors of the Fed’s much-anticipated report make a point to note on several occasions that the paper “is not intended to advance any specific policy outcome.” Indeed, the report gives off a vibe of open-endedness and covers both risks and benefits of a potential U.S. CBDC. Specifically, it acknowledges user privacy concerns that some crypto advocates have previously voiced in the context of the potential digital dollar’s design.
On Twitter, crypto-friendly members of the U.S. Senate sounded content with the document’s findings and framing. Senator Cynthia Lummis welcomed the report’s concession that the ultimate fate of the U.S. CBDC project rests with Congress:
I’m pleased the Federal Reserve released their long-awaited report on central bank digital currencies this afternoon. Here’s a quick thread of my thoughts.https://t.co/UAJFIPwiqG
Senator Pat Toomey called the paper a constructive contribution to the public discussion around
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