#11: Digital Currencies: Coexistence or Competition

CBDC Broadcast

1 Nov

17th November 2022

With:

| Commissioner Hester M. Pierce (U.S. Securities and Exchange Commission)

| Professor Patrick McCarty (Georgetown University Law Center)

In Session #11, FNA welcomes Commissioner Hester M. Peirce (SEC) and Professor Patrick McCarty (Georgetown University) to navigate the complexities of a potential U.S. retail CBDC. As the Federal Reserve continues to weigh the benefits of a digital liability, our guests examine whether a digital dollar is a necessary tool for maintaining the greenback’s global dominance or a threat to private sector innovation and personal privacy.

The discussion moves beyond "technical feasibility" to address the Privacy-Stability Paradox: how can the U.S. design a system that prevents bank disintermediation and financial surveillance while still providing the efficiency and financial inclusion benefits promised by CBDCs? We also explore the competitive landscape, asking if the rise of USD-backed stablecoins and private crypto-assets makes a sovereign digital dollar redundant or more urgent than ever.

Key Discussion Points:

The Regulatory Maze: Analyzing the jurisdictional overlaps between the SEC, CFTC, and the Fed in a post-digital-dollar world.
Financial Stability & Disintermediation: Strategies for designing a CBDC that doesn't drain deposits from the commercial banking system during times of stress.
The Global Lead: Examining the geopolitical implications of a "first-mover" advantage (or lack thereof) compared to other G7 nations and the e-CNY.
Stablecoin Synergy: debating whether private stablecoins are a viable alternative to—or a critical partner for—a national digital currency.
Privacy by Design: Addressing Commissioner Peirce’s concerns regarding financial surveillance and the protection of individual liberties in a digital financial system.

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