Ahead of the Jackson Hole global central bank symposium, the crypto community held a blockchain conference in Jackson Hole, attracting Fed officials, SEC executives, and Trump's son. Christopher Waller, a Federal Reserve Governor appointed by President Trump and considered a leading candidate for the next Fed Chair, spoke at the conference on Wednesday, calling for embracing the "technology-driven revolution" occurring in artificial intelligence and stablecoin sectors, believing it could drive U.S. economic development.

In his remarks, Waller stated that digital asset innovation is "not scary," and the payment system is experiencing a "technology-driven revolution." Current advances in computing power, data processing, and distributed networks are generating numerous innovative payment services.

"When thinking about smart contracts, tokenization, or distributed ledgers, there's nothing to fear."

"The technology we have today may be new, but using innovative technology to build new payment services is not."

Supporting Fed-Industry Collaboration in Payments

Waller was appointed by Trump in 2020. He has previously expressed support for applying certain technologies from decentralized finance (DeFi), believing they could complement traditional payment systems. For example, he mentioned that distributed ledger technology could more efficiently and rapidly record asset transfer processes.

In Wednesday's speech, Waller emphasized that DeFi's impact on payments, including its risk mitigation role, could yield positive results under cooperation between the private sector and the Federal Reserve. He said both public and private sectors can embrace innovation within their respective roles.

He noted that in recent years, some of the most groundbreaking innovations have been "stigmatized" due to their association with digital assets.

"These are just technologies, so why are they so bad? If these technologies can bring more practical and interesting application methods, we should also study and adopt them."

Analysis suggests that cryptocurrency companies are weighing a key strategic question: how much control to maintain in digital currency circulation mechanisms, whether to build entirely new systems, rely on shared systems, or pursue both approaches.

Regarding this, Waller stated that payment system evolution has always been driven by technological progress, with most changes led by private sector innovation, while key infrastructure is supported by the Federal Reserve—either as a system operator providing core infrastructure or guiding the industry in developing specific solutions like payment standards.

"This complementary relationship has created America's secure and efficient payment system, serving as the backbone of domestic and international business activities. Therefore, the Federal Reserve must continue embracing technological progress, modernizing services, and continuously supporting private sector innovation."

Fed Researching Tokenization and AI Technology in Payments

The Federal Reserve launched its long-awaited payment network FedNow in 2023, enabling instant fund transfers between eligible banks with Federal Reserve accounts. Prior to this, the U.S. had somewhat lagged behind other countries in real-time payment adoption.

Waller indicated that the Federal Reserve is studying a new wave of payment technology innovations, including tokenization, smart contracts, and artificial intelligence applications in payments.

"As a central bank, we may never go down this path, but there's no reason not to explore and see what happens."

Waller said that as a payment system operator, understanding these trends is crucial, not only to help the Federal Reserve better support private companies using related infrastructure but also to assess whether emerging technologies have the potential to improve the Fed's existing platforms and services.

"In fact, I believe the Federal Reserve should further strengthen its interaction with industry innovators, especially as traditional finance and digital asset ecosystems increasingly converge. We are studying how to advance this work, so stay tuned."

The Wyoming Blockchain Summit was held three days before the Jackson Hole global central bank symposium. Analysis suggests this summit marks the climax of what Goldman Sachs previously described as the "Summer of Stablecoins."

Waller is also the second Fed senior official this week to publicly praise the cryptocurrency industry. The day before Waller's speech, Fed Vice Chair for Supervision Michelle Bowman also spoke at the summit, stating that banks and regulators should treat the industry better and praising tokenization developments.

In Tuesday's remarks, Bowman stated that the banking industry and regulators must accept the benefits brought by new technologies such as artificial intelligence and cryptocurrencies, or risk diminishing roles in the economy. She indicated that ideally, regulators should allow these new applications to "expand in ways that benefit the banking system."