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New Paper Highlights Design Options, Implementation Choices, and Implications for U.S. Central Bank Digital Currency

NEW YORK, July 27, 2021 – A new report, titled On the Road to a U.S. Central Bank Digital Currency – Challenges and Opportunities, from The Clearing House Association identifies a number of important U.S. Central Bank Digital Currency (CBDC) design options and implementation choices, and outlines important considerations for policymakers.

"Much of the discussion to date relating to a possible U.S. Central Bank Digital Currency has taken place in the abstract, with CBDC being proffered as a solution to everything from financial inclusion to monetary policy, but different policy objectives will require different design choices. This paper focuses the discussion on practical policy considerations, design choices, and the implications of certain key options in order to assist policymakers in identifying and weighing the real costs and benefits of a U.S. Central Bank Digital Currency," said Stephanie Heller, General Counsel of The Clearing House. 

The report outlines a number of considerations that policymakers should address in order to provide a realistic framework for discussion about the possible introduction of a CBDC in the U.S. Among others, The Clearing House makes the following recommendations and observations about a potential U.S. CBDC:

  • Purpose of CBDC: Policymakers should articulate a clear purpose for a U.S. CBDC, as doing so will inform other design choices that will need to be made to ensure that the stated purpose is being advanced. A clear purpose also enables policymakers to determine if there are other, less risky means available to meet the stated purpose. 
  • Treasury and Federal Reserve study: Policymakers should continue to proceed cautiously. The Treasury Department and Federal Reserve should conduct a joint study of the specific purpose for which a U.S. CBDC would be implemented that identifies the likely impact it would have on monetary policy, financial stability, the safety and soundness of the financial sector, the impact on the efficiency of U.S. payment systems and financial crimes and sanctions evasion, and if there are other, less risky means of achieving the purpose.
  • Strong Legal Foundation: Current U.S. law is not likely sufficient to support a CBDC and the introduction of a CBDC would require new, carefully crafted legislation that describes the roles and responsibilities of relevant government entities and private sector participants as well as laws that support the use of CBDC and appropriately protect the users of CBDC.  
  • Do No Harm: The introduction of a U.S. CBDC has the potential to destabilize both the domestic and foreign banking and financial services sectors, and to make illicit activity using the U.S. dollar easier. While it may not be possible to do no harm when introducing U.S. CBDC, avoiding these outcomes should be a high priority in any U.S. CBDC implementation even at the expense of the intended purpose.

The full paper can be accessed here.

About The Clearing House Association
The Clearing House Association is a nonpartisan advocacy organization that represents the interests of its member banks and the broader banking industry by developing and promoting policies to support a safe, sound, and competitive banking system that serves customers, communities, and economic growth. Learn more at

Media Contacts:
Greg MacSweeney
The Clearing House

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