Federal Reserve Chair Powell: If there were a digital dollar, you wouldn't need stablecoins or cryptocurrencies

"If you have digital U.S. currency, you don't need stablecoins or cryptocurrencies, and that's one of the strong arguments in support of it (digital U.S. currency)," Powell said.

Federal Reserve Chairman Powell stated at a hearing of the U.S. House Financial Services Committee on Wednesday that the Fed will release a report on central bank digital currencies (CBDC) in early September source.

Powell mentioned that the report will broadly outline the benefits and risks of CBDCs, cryptocurrencies, and stablecoins.

He believes that stablecoins have advantages in the payment system and share some characteristics with CBDCs, stating that "Stablecoins are like money market funds, bank deposits, or narrow banks, but there are still risks with stablecoins."

However, he also emphasized that if stablecoins are to play a significant role in the U.S. payment network, they need to be regulated.

Powell reiterated that even if other countries develop CBDCs, the U.S. dollar's status as the world's reserve currency will not be threatened. He also believes that digital currencies can replace decentralized digital assets.

This article is authorized to be reprinted from Vision News Network