US Treasury exploring private use of digital dollars.

The U.S. Treasury Department is currently investigating ways to preserve privacy and anonymity in retail transactions involving a digital dollar, according to Graham Steele, the assistant secretary for financial institutions. Steele emphasized the importance of considering the preservation of privacy and anonymity in the design of any potential retail central bank digital currency (CBDC). He suggested exploring technologies and methods, including Privacy Enhancing Technologies (PETs), to enable such protections while maintaining transparency and traceability. However, Steele also acknowledged the risks involved in implementing a retail CBDC, such as the possibility of runs. He noted that a Treasury-led group is evaluating policy objectives related to global financial leadership, national security, privacy, illicit finance, and financial inclusion. Meanwhile, Treasury Secretary Janet Yellen expressed her concerns about regulatory gaps in the oversight of non-securities digital assets and stablecoins. She called for a comprehensive federal prudential framework for the crypto sector and expressed her willingness to collaborate with Congress to develop such a framework.

Read More: Privacy Concerns Dominate CBDC Discussion at Consensus 2023

Edited by Nelson Wang.