A central bank digital currency is one of the worst financial ideas ever – US Congress hearing
Another member of the committee from R. Street Institute, Alex Pollock, argued that having a digital currency owned and regulated by the Central Bank is the worst financial idea in the recent times. According to Pollock, the digital currencies by the central bank would do nothing but increase the role and power of the central bank. It would also make the Central Bank an overwhelming credit allocator in the United States economy.
In Pollock’s words:
“Its safe to predict that the credit allocation of the central bank will undoubtedly become politicized. Taxpayers will be on hook for credit losses. The Central Bank will bear the risk directly.”
According to Pollock, if fiat money is digitized, the nature of the currency will not change and the Central Bank will still be responsible for issuing it. He said that cryptocurrencies are more or less the same as scrip.