Federal government considers digital currency

The Federal Reserve is exploring a digital currency, similar to bitcoin, although its implementation would be far off in the future, the President and CEO of the Fed's New York branch William Dudley told The Hill.

The value of bitcoin hit an all-time high this month, skyrocketing past $11,000 in trading value just a day after surpassing $10,000.

However, federal officials have been slow to regulate the technology. In 2014, the Securities and Exchange Commission warned investors to its potential risks, noting they "give rise to frauds and high-risk investment opportunities."

"Potential investors can be easily enticed with the promise of high returns in a new investment space and also may be less skeptical when assessing something novel, new and cutting-edge," the SEC wrote in a 2014 letter, according to The Hill.

Other officials remain skeptical the Federal Reserve is even contemplating the decision. Philadelphia's Federal Reserve President Patrick Harker doesn't think the government could get behind the abstract idea of digital currency.

"The paper that's in your pocket, that we call money, only has value because we believe it has value, because we believe the government stands behind it. It's all trust issues," he said at a Fintech event in September, according to Coindesk.  

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