The Federal Reserve will consider a virtual currency that is based on blockchain technology that allows users to pay each other with a digital token instead of using credit cards, according to a letter to the chairman and other top banking officials.
The virtual currency, called the U.S. dollar bitcoin, is being promoted by a small but growing number of individuals and businesses, who say it’s an alternative to the traditional payment system that can be used to buy goods and services online.
Bitcoin transactions are recorded in a public ledger known as the blockchain, which is not owned by a central authority, making it vulnerable to hackers or fraudsters.
The White House has expressed support for virtual currencies.
Last month, the Treasury Department said it was “currently exploring the potential for the issuance of virtual currencies in the U