Robert Kaplan, President of the Dallas Federal Reserve, believes that the US Central Bank would eventually create its own digital money, claiming that this is the final step in the payment system’s digitization.

According to Kaplan, the central bank is actively working on it, and he goes on to say,

“I would imagine in the years ahead — it’s something the Fed is actively working on now — and I can see reasons why that will eventually get developed; China is already doing their own experiment with it. The Fed is a “long way” from making a decision and is currently studying the issues, including the potential impact on banks.”

The Opposite End Of The Spectrum

While Robert Kaplan sees the central bank and the bitcoin market as favorable, Minneapolis Federal Reserve President Neel Kashkari sees the market differently. Kashkari remarked that the world’s largest and most popular cryptocurrency did not have any meaningful use cases, characterizing the digital asset sector as prone to hype and fraud.

Kashkari said during the Pacific Northwest Economic Regional Annual Summit,

“Cryptocurrency is 95% fraud, hype, noise, and confusion.”

While cryptocurrencies have gained much popularity this year, they are still seen as highly speculative and dangerous assets compared to traditional markets.

Opinions on the Federal Reserve’s Monetary Policy Plans

Kashkari also shared his thoughts on monetary policy initiatives, stating that there is still much slack in the labor markets. Therefore, before he supports reducing the monthly purchase of $120 billion in Treasury and mortgage-backed securities, he stated that he might need to see more strong job reports.

The President of the Minneapolis Federal Reserve remarks when there is significant discussion about when the Def will begin to withdraw its Covid-era concessions as the economy recovers from the ravages of the pandemic. If the job market is good, Kashkari feels it would be acceptable to reduce bond purchases by the end of the year.

Despite serious concerns about the Delta strain of the Coronavirus, the US created 943,000 jobs in July, signaling that economic recovery was gaining traction.

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