Fed Governor Outlines Path Forward on Payments Innovation

Federal Reserve Governor Christopher J. Waller outlined how private-sector innovation, supported by safe public infrastructure, should drive the future of payments and digital assets.

In remarks at the Wyoming Blockchain Symposium, Mr. Waller described payments as undergoing a "technology-driven revolution" and stated that there is "nothing scary" about new tools like smart contracts, tokenization, or distributed ledgers. He described how innovations from credit cards to instant payments have consistently come from the private sector, and he argued that stablecoins, when properly regulated, could expand access to the U.S. dollar and help reinforce its role in global markets. He welcomed the GENIUS Act for clarifying oversight of stablecoin issuers and creating conditions for responsible growth.

Mr. Waller outlined two models of payments innovation. He said the first is a private-sector-led model, which should be the default approach, where firms use new technologies to create products and services that meet consumer needs. He said the second is a limited public-sector model, where the Fed steps in to provide core infrastructure—such as Fedwire or the Fed’s instant payments platform—that private firms can then build upon to serve their customers. He stressed that the Fed’s mission is to provide safe, reliable platforms, not to compete with innovators. He said that by focusing on foundational services, the Fed can enable banks and Fintechs to develop new customer-facing tools while preserving financial stability.

Mr. Waller also pointed to artificial intelligence as an emerging force in payments, fraud detection, compliance, and reconciliation. He urged policymakers to prioritize regulatory clarity, continued engagement with industry, and to consider policies that let market forces drive responsible innovation. He warned that resisting technological progress could leave the U.S. payments system less efficient and less competitive internationally.