The executive order issued by Joe Biden on Mar. 9, 2022, was primarily focused on cryptocurrencies. Nonetheless, his mention of a U.S. digital currency received significant attention and brought the U.S. government one step closer to regulating both cryptocurrencies and a United States central bank digital currency (CBDC).
With just three months left for the Office of Science and Technology Policy (OSTP) to report back to Biden on the risks and benefits of establishing a CBDC, Carole House, a key member of Biden's National Security Council (NSC), was on hand this week at an event hosted by the Atlantic Council—an organization with deep connections to the impeachment of President Trump and with close ties to Hunter Biden and Burisma. House is the NSC's director of cyber security and secure digital innovation.
House delivered opening remarks at the Atlantic Council's panel discussion on the challenge of cybersecurity and the need for responsible innovations in digital currency (Atlantic Council's in-depth report is here). She also commented she was "very excited for [a] panel to examine some of the key issues related to the design choices, technology, and governance that we need to account for in looking at CBDC developments for the United States, as well as working with our international partners." She added:
"We need robust protections. We also need to confront how our financial system has and has not worked for certain consumers and ensure that we have access to services that are equitable, inclusive and efficient. That's why, in the U.S., we are placing the highest urgency on the research into the merits of a possible U.S. central bank digital currency, continuing to build off of the many years of efforts being driven out of the Federal Reserve."
Pressure to explore a possible CBDC continues to rise. House joins "center-left" "think tank" Third Way next week to discuss "Will China's Authoritarianism Dominate the Digital World Order?" She explained that Biden's EO on exploring the benefits and risks of digital assets is "so important" to ensure proper protections are in place. In late May, feeling the pressure in the "race for the future of money," the new vice-chair of the U.S. Federal Reserve, Lael Brainard, testified before Congress that the United States was at risk of falling behind.
In her May 26 testimony, Brainard stated she believes it is important "the U.S. play a lead role in the development of safety standards governing international digital finance transactions involving CBDCs consistent with the norms of privacy, accessibility, interoperability, and security." Brainard commented that the Federal Reserve has received nearly 2,000 comments from stakeholders in response to a January discussion paper on the U.S. dollar and digital transformation. She said the Federal Reserve plans to publish a public summary of the comments in the near future, adding:
"In future states where other major foreign currencies are issued in CBDC form, it is prudent to consider how the potential absence or presence of a U.S. central bank digital dollar could affect the use of the dollar in global payments. A U.S. CBDC may be one potential way to ensure that people around the world who use the dollar can continue to rely on the strength and safety of the U.S. currency to transact and conduct business in the digital financial system."
According to the Atlantic Council, ten countries have fully launched a digital currency, with China's pilot set to expand in 2023. Jamaica is the most recent nation to launch a CBDC, the JAM-DEX. Nigeria, Africa's largest economy, launched its CBDC in October 2021. Currently, 105 countries, representing over 95 percent of global GDP, are examining a CBDC.
Remarkably, in May 2020, with the pandemic just underway, only 35 countries were considering a CBDC. A record-high 50 countries are now in an advanced exploration phase (development, pilot, or launch). Of the G7 nations, the Atlantic Council reports the U.S. and U.K. are the furthest behind developing a digital currency. Meanwhile, the European Central Bank has signaled it will aim to deliver a digital euro by the middle of the decade.
Screenshot / Atlantic Council CBDC tracker
It is worth pointing out that the Atlantic Council—funded by Facebook, Google, Goldman Sachs, and the Rockefeller Foundation—is connected to significant controversies through members of its board. Board member Sally Painter owns Blue Star Strategies, which is under investigation by the U.S. Department of Justice for possible illegal lobbying on behalf of Burisma Holdings while Hunter Biden was on the board. Blue Star Strategies helped coordinate Atlantic Council forums where Burisma officials spoke as panelists, and Burisma funded an energy conference in Ukraine in 2018 where Atlantic Council associates participated.