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Bitcoin trades below $40,000 following stock selloff

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"The introduction of a (central bank digital currency) would represent a highly significant innovation in American money," the study said. The Fed said it "could fundamentally change the structure of the U.S. financial system, altering the roles and responsibilities of the private sector and the central bank."

The report comes at a time when digital money is proliferating in a variety of forms.

Central banks around the world are studying government-backed digital currencies.

China's central bank has already tested a digital version of the yuan. The European Central Bank began exploring a digital euro in October and said its "investigation period" would last two years.



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