Cryptocurrencies and stablecoins will be obsolete once the United States adopts a digital currency, according to Fed Chair Jerome Powell

According to Federal Reserve Chair Jerome Powell, a digital currency issued by the US central bank might undercut private alternatives such as cryptocurrencies and stablecoins. "You wouldn't need stablecoins" if you had a digital currency, Powell says, "I think that's one of the strongest arguments in its favor." Fed officials will publish a discussion paper in early September that will look at the digital payments universe in general.

Powell expressed his skepticism about crypto assets becoming a primary mode of payment in the future. Stablecoins, need greater regulation before they can play a significant role in the financial system.

Some policymakers argue that a CBDC is unnecessary, thus Fed officials may encounter heated debate as they decide whether to move through with a digital version of the dollar. Powell reaffirmed that the Fed would consult Congress and the public before moving forward with the development of a CBDC.

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