Definition ∞ Digital Dollar Adoption refers to the increasing acceptance and utilization of a central bank digital currency (CBDC) issued by the United States Federal Reserve. This involves the integration of a digital form of the US dollar into financial systems and daily transactions. It represents a shift towards a more digitized national currency infrastructure. The goal is to enhance payment efficiency and financial stability.
Context ∞ The discussion surrounding digital dollar adoption involves significant policy debates regarding privacy, financial stability, and its potential impact on commercial banks. Proponents suggest it could modernize payment systems, reduce transaction costs, and extend financial inclusion to underserved populations. Critics voice concerns about government surveillance and disintermediation of traditional banking. Global developments in CBDCs influence the urgency and direction of US efforts.
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