The Federal Reserve finally released a much-delayed paper yesterday opining on the pros and cons of developing its own central bank digital currency (CBDC), but without coming to any firm conclusions.

Why it matters: Around the world, there are now 23 CBDCs either in pilot or formally launched. They have morphed from a theoretical concept into real-world digital cash, changing the way governments and millions of people use money — but not in the U.S.

Between the lines: Although the Fed's paper doesn't advocate one way or another on whether the U.S. should begin development, the language used in the paper indicates that it’s very open to the idea, Josh Lipsky, director at the Atlantic Council’s GeoEconomics Center, tells Axios.

• “Part of the reason that they’re [open to it] is they see countries around the world exploring CBDCs," says Jonathan McCollum, chair of federal government relations for Davidoff Hutcher & Citron. "I think they understand that the U.S. has an important role to play in creating some sort of [international] standards.”

The big picture: A digital dollar would be legal tender pegged to the value of the physical dollar and backed by the Fed.

• Central banks are considering CBDCs in order to retain control over monetary policy in the face of growing cryptocurrency adoption, and because they could enable more efficient government payments and financial inclusion.
• It's also a matter of international influence: Fed vice chair nominee Lael Brainard, for...

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