The Libra project on cryptocurrency should be a sufficient motivation for the Federal Reserve to launch a real-time payment system, a senior government official wrote.
Federal Trade Commission (FTC) Commissioner Rohit Chopra wrote a letter to the Fed – the US central bank – to support the potential development of the "FedNow Service", the potential high-speed payment system that the group is studying. currently.
And, joining other government officials around the world, Chopra criticized Libra, the cryptocurrency project run by Facebook and unveiled for the first time in June.
"The vague and rare details about the global central bank proposed by the technology platform have sounded the international alarm, especially in light of ongoing scandals and Facebook's reputation for abuse," he said. he writes. "The detailed list of risks raised by the Libra project will take time to unwind and address. I share the serious concerns expressed by President Jerome Powell and Governor Lael Brainard. "
However, he considers that it is more important to find a solution from the public sector to the current payment system, by writing:
"Whatever the fate of Libra, the emergence of the proposal underscores the appetite for real-time payments and the urgency of Federal Reserve intervention."
He sees the demand for prompt payments, noting the "accumulated frustration" due to high bank charges and noting that "other real-time technologies" are spreading rapidly.
We do not know what FedNow would look like or how it would work. The project will not be online until 2024.
Although nothing indicates that FedNow will use the blockchain at any given time, two US lawmakers have written to the Fed to inquire about its views on technology. Last month, French representatives French Hill (R-Ark.) And Bill Foster (D-Ill.) Presented a number of questions to the Fed, noting that the global supremacy of the dollar could be jeopardized if d & # 39; Other countries were developing a widely adopted digital decision. currency first.
The Fed plans to respond to the letter at an undetermined future date.
Rohit Chopra image via FTC / Wikimedia Commons