(Reuters) -Federal Reserve Chair Jerome Powell met with the chief executive of cryptocurrency exchange operator Coinbase Global Inc on May 11, days before the central bank chief announced plans for a white paper examining whether the Fed should develop a digital currency of its own.
The meeting with Coinbase CEO Brian Armstrong was made public on Friday with the monthly release of Powell’s meeting calendar. The record showed that the in-person meeting was also attended by former U.S. House of Representatives Speaker Paul Ryan, who is now with private equity firm Solamere Capital.
On May 20, days after the meeting, Powell said the Fed would release a discussion paper this summer “outlining our current thinking on digital payments, with a particular focus on the benefits and risks associated” with establishing a central bank digital currency.
Policymakers are ramping up their exploration of a potential digital dollar. The Boston Fed is also conducting a multiyear research project with the Massachusetts Institute of Technology on the technology that could be used to develop a central bank digital currency. The first phase of those findings will be released later this quarter.
As policymakers dive into the pros and cons of a central bank digital currency, Powell and other officials have made it clear they cannot officially proceed without congressional action. The concept also recently faced strong skepticism from some Fed officials who say some of the potential benefits of a digital currency could be offered through other means.
Fed Vice Chair for Supervision Randal Quarles said last week that the U.S. dollar is already “highly digitized” and financial inclusion issues may be better addressed with other solutions, such as improving access to low-cost bank accounts.
“Before we get carried away with the novelty, I think we need to subject the promises of a CBDC to a careful critical analysis,” Quarles said during a bankers convention in Utah.
(Reporting by Dan Burns; additional reporting by Jonnelle Marte; editing by Chizu Nomiyama and Jonathan Oatis)