US Fed Chair said about digital dollar: “It’s our obligation to understand it well and not wake up one day and realize that the dollar is no longer the world reserve currency because we just missed a technological change”.
Powell said also that private entities aren’t needed to build central bank digital currencies. So now a ideas about Ripple and Stellar as a digital dollar would be discussed between a dreamers only. Nothing from the existing cryptocurrencies would be a digital dollar. The Federal Reserve will never allow.
But what about the idea “wake up one day and realize that the dollar is no longer the world reserve currency”, I think Powell has felt it correctly. This is the most likely scenario of the future. Because no one new blockchain can compare to bitcoin.
I mean self-regulation mechanism of mining hardness. Just remember the new super-powerful asic miner have promised make miners millionaires or given an unprecedented advantage over others miners, but what have happened: mining hardness set a record and it has rosed 15% for the last 2 years (https://www.blockchain.com/charts/difficulty). And the self-regulation process was laid in bitcoin 10 years ago when nobody knows about the asics and when miners used common Core 2 Duo.
And it is really magick, the itself bitcoin design provides different mechanisms to protect against collapse. And things like it make bitcoin more far-sighted than a lot of mainstream economists.
Formerly chairman of Morgan Stanley Asia and chief economist at Morgan Stanley Stephen Roach said that a dollar crash is inevitable. He is waiting for a collapse over the next year or two. And he is scientist and he has about 30 years experience of main positions in one of the largest bank of the world. And to his mind Powell has 1 year only before the waking up and realizing that the dollar is no longer the world reserve currency.
So let’s think could the Fed Reserve create something better than bitcoin or at least something efficient like Ripple for the 1 year? (True answer is No).