What is a digital dollar?

A digital dollar would be a form of legal tender in the U.S. that could be used to purchase goods and services, and settle all and any outstanding debts. But it would exist in virtual form only, stored and exchanged online via computer networks, never taking the physical form of paper banknotes. CBDCs resemble cryptocurrencies like Bitcoin.

Could a central bank 'digital currency' be a digital currency?

As technology continues to revolutionize the way people live, work and spend, central banks around the globe have kicked off efforts to reinvent their local currencies for the digital era. Now, the United States is the latest to signal “urgency” in researching a potential digital version of its dollar via a Central Bank Digital Currency, or CBDC.

Could a 'digital dollar' be a real possibility?

President Biden often summarizes his vision for America in one word: Possibilities. A “digital dollar” may seem far-fetched, but modern technology could make it a real possibility. A United States central bank digital currency (CBDC) would be a digital form of the U.S. dollar.

Will the Fed create a digital dollar system?

It’s worth noting that the central bank has yet to commit to creating a CBDC in the first place, so the final form of a digital dollar system remains an open issue. Presently the Fed is studying how a digital dollar could help expand consumer access to the financial system and support faster and cheaper payments.