FedFin Analysis: Treasury Presses CBDC, Nonbank Payment Powers

In this in-depth report, we follow through as promised on our initial analysis of key sections in last Friday’s Treasury report on CBDC and changes to the payment system.  In this and subsequent in-depth reports, we go beyond our focus on Treasury’s recommendations to analyze the rationale behind them and lay out our forecast for next steps.  We noted last week that the Treasury report cannot force the Fed to adopt a CBDC but clearly seeks to press the U.S. central bank quickly to undertake the policy and technology action steps necessary to achieve the numerous benefits attributed to what Treasury would consider a well-designed CBDC.