Federal Reserve Vice Chairman Michael Barr Highlights Fed's Role in Financial Innovation and CBDC Research
Summary:
Federal Reserve vice chairman, Michael Barr, discussed the central bank's role in financial innovation, emphasizing research, supervision, and the FedNow Service. He highlighted the Fed's focus on central bank digital currency (CBDC) research, including transaction recording and tokenization models. Barr also mentioned the Novel Activities Supervision Program and the need for strong oversight of stablecoins. He addressed the FedNow Service, which provides 24-hour instant payments infrastructure.
The vice chairman of the Federal Reserve Bank, Michael Barr, discussed the central bank's involvement in financial innovation at the Philadelphia Fed's fintech event on September 8. Barr emphasized that the Fed's role includes research and supervision, and acknowledged the FedNow Service as part of these efforts. He also highlighted the Fed's current focus on central bank digital currency (CBDC) research, particularly in areas such as transaction recording and tokenization models. Barr noted that the technology associated with tokenized platforms is compatible with existing central bank money. Barr also mentioned the Fed's Novel Activities Supervision Program, which allows federally supervised banks to engage in novel activities, including stablecoins, with feedback from a dedicated team of supervisors. He explained that strong federal oversight of stablecoins is important to protect financial stability and the US payments system. Additionally, Barr mentioned the Fed's FedNow Service, which provides 24-hour instant payments infrastructure to banks and credit unions. Although current volumes on the service are low, it is ultimately up to depository institutions to make it available to the public.
Published At
9/8/2023 7:30:00 PM
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