Recent comments from Jerome Powell, the chairman of the U.S. Federal Reserve, show the American government is not especially concerned with speed when it comes to developing a central bank digital currency, or CBDC. In contrast, Morgan Creek Digital co-founder Anthony Pompliano argues that time is of the essence.
“They’re talking about like, maybe we’ll build one in the next couple of years,” Pompliano said of Powell’s recent comments on CBDCs. “This is not a next couple of years thing,” Pomp said on an Oct. 19 episode of his YouTube show, Lunch Money.
“This is a right now thing, and if they don’t act, the U.S. is going to fall really far behind China, because it all comes down to accessibility.”
Powell expressed the importance of accuracy over speed when it comes to issuing a CBDC during a discussion about cross-border payments on Oct. 19. “We have not made a decision to issue a CBDC, and we think there’s a great deal of work yet to be done,” Powell said, placing greater focus on building a CBDC correctly than winning the digital currency race.
Meanwhile, China continues moving forward with its CBDC pursuits, and has already begun testing its digital yuan.
Pomliano explained the importance of accessibility. “If I’m sitting somewhere in the world, and I can use an internet connection, and I want a global currency, can I get yuan, or can I get the dollar,” he noted. Based on Pompliano’s comment, people may gravitate toward the easiest solution, which could be China’s CBDC if it becomes the dominate digital option before the U.S. enters the game.
Pompliano joined CNBC for an interview in September 2019 during which he expressed the importance of a digital U.S. dollar. After a year of CBDC interest from numerous countries around the globe, Pompliano’s comments still remain relevant.