It is important that we consider the extent to which privacy and anonymity might be preserved, said Graham Steele, the assistant secretary for financial institutions at the U.S. Treasury Department. He was speaking at the Transform Payments USA 2023 Conference in Texas, where he discussed the potential of a central bank digital currency (CBDC) and the need to explore technologies and methods to protect transactional privacy.
Treasury Secretary Janet Yellen also testified Tuesday in the House Financial Services Committee, expressing her concern about the lack of regulatory oversight in the spot market of non-securities digital assets and stablecoins. She said the crypto sector needs a comprehensive federal prudential framework.
Steele noted the possible risks of a retail CBDC, including the danger of runs. He said the recent U.S. banking turmoil showed the technology enabling the movement of deposits only getting faster, which increases the hazard of high-speed, panic-driven movements of funds. A Treasury-led group is evaluating policy objectives related to global financial leadership, national security, and privacy, illicit finance, and financial inclusion.