Former CFTC Chairman: U.S. Payment System Modernization Too Slow to Develop CBDC

The former chairman of the Commodity Futures Trading Commission (CFTC), Tim Massad, stated that the pace of the United States' modernization of payment systems is too slow to develop a central bank digital currency (CBDC). Therefore, "we should also take action to improve access to financial services through other means - the demand for this is too great!"

Former CFTC Chairman Massad, who served until 2017, attended a hearing of the Joint Economic Committee on digital assets and stated that CBDCs could be a solution for the United States to improve its existing payment system, as the current system is slow and costly. Massad mentioned that stablecoins could serve this purpose, but they also present challenges to U.S. regulatory agencies and pose significant risks.

Massad pointed out that the use of stablecoins like Tether (USDT) to transfer funds between exchanges is a good example of why the U.S. payment system needs modernization.

However, he raised concerns that stablecoin issuers' reserves may not be invested in "highly secure liquid assets" like the U.S. dollar, suggesting the adoption of regulations similar to banks to prevent issuers from making loans, thus eliminating the need for deposit insurance.

"CBDCs, stablecoins, and digital assets are generally considered a means to achieve greater financial inclusion, and we should consider their potential."

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