Confusion engulfed a US Senate committee that was supposed to discuss the issuance of a digital dollar. The debate turned to crypto in general and the environmental impact of cryptocurrencies. It all started when Senator Elizabeth Warren, the senator chairing the committee, started the meeting with sharp criticism of cryptocurrencies.
She stated that cryptocurrencies have a high carbon footprint and they were conduits for cybercrime. She mainly took note of the most recent attacks, where criminals demanded millions of dollars in crypto. She said that these are issues that the U.S government should be proactive in tackling.
Despite these critical opening remarks, the panel experts gave their views on the digital dollar and CBDCs in general. One of those who gave his views on the digital dollar is Christopher Giancarlo. Giancarlo is the brains behind Digital Dollar Foundation and also an ex-chairman of the CFTC.
In his submissions, Giancarlo stated that the digital USD would make transactions more traceable. However, he added that, while it is easily traceable, the digital currency would have privacy safeguards that are better than most existing financial instruments.
Another expert in the room was Neha Narula. Narula, the head of the Digital Currency Initiative at MIT, touched on the digital dollar encryption technology issue. In response to U.S climate change envoy John Kerry, Narula stated that encryption technology would be instrumental to developing the digital dollar.
Lev Menand, of Columbia Law School, was also part of the panel. Menand argued that a national digital currency would widen the number of people who are part of the existing financial system.
According to Senator Elizabeth Warren, this was the first sitting, and a more comprehensive report would be out next month. With China leading the way on CBDCs, the U.S move will be interesting to watch.