Biden to issue executive order to explore cryptocurrency-like digital dollar

President Biden is signing an executive order Wednesday to explore establishing a U.S. Central Bank Digital Currency (CBDC) — also known as a "U.S. digital dollar"  — akin to a cryptocurrency, according to senior Biden administration officials.

One key difference between the digital dollar and cryptocurrency is that the former would be subject to some regulation by central banks. So, for instance, the Federal Reserve could issue some monetary policy around issuance rates, address any inflation concerns and more. Senior Biden administration officials note that already there are more than 100 countries that are looking into issuing their own centralized digital currencies.  Several agencies of the federal government have already begun researching the introduction of a U.S. digital dollar, but senior Biden administration officials stressed that this is the first time the federal government has taken a "holistic" approach to assessing a the possibility of a centralized digital currency, connecting both government banking institutions with departments and agencies focused on security considerations to mitigate risk.  

The digital currency announcement comes on the heels of a series of harsh sanctions the U.S. and its allies have been imposing on Russia as a result of its invasion of Ukraine, but senior administration officials say the timing of the executive order is unrelated. They say that that the use of cryptocurrency isn't supplying Russia with a "viable workaround" to dodge the battery of sanctions the Russian economy is facing.