Fed Governor Waller questions CBDC’s payments utility

Christopher Waller, a member of the Federal Reserve Board, expressed doubts about whether the U.S. payment system needs a central bank digital currency (CBDC) at the 2024 Clearing House Annual Meeting on November 12, questioning whether there are problems in the system that CBDC can solve. He said: "I asked in a speech in August 2021, what problems can CBDC solve? In other words, what market failures or inefficiencies require this specific intervention? For more than three years, I have not heard a satisfactory answer about CBDC." Waller advocates market-driven solutions and emphasizes the benefits of the private sector promoting innovation in payment systems through competition. He said that the private sector is driven by profit and competition and tends to make better decisions when determining which technologies are worth investing in and which technologies may not meet consumer needs. Waller further stated that until a clear need that cannot be met by the private sector is identified, the role of the government should remain supportive rather than directly competing with private payment innovation. (CryptoSlate)