“Libra bust this way out into the open,” said Karen Petrou, a managing partner at Federal Financial Analytics who advises executives on coming policy shifts.

But it’s not just Facebook. The matter is also taking on urgency as other countries consider creating their own digital currencies — another potential challenge to the primacy of the U.S. dollar. The head of the Bank of England has floated the idea that central banks could create a network of digital currencies to replace the dollar as the world’s reserve currency.

The discussions are informal at this point. Members of Congress from both sides of the aisle have written to the central bank asking officials to consider how they might approach a digital currency, and some Fed officials have begun to acknowledge the government might someday play a role.

“It is inevitable,” Federal Reserve Bank of Philadelphia President Patrick Harker said at a recent conference, according to Reuters. “I think it is better for us to start getting our hands around it.”

Those discussions will land on the Fed’s doorstep this week as the world’s top financial policymakers gather in Washington for meetings of the International Monetary Fund and the World Bank.

Even if Libra fails because of Facebook’s political baggage — the blowback from lawmakers and regulators has been so fierce that the association tasked with running the cryptocurrency has lost a quarter of its initial members — central bankers worry that another major company could enter the space. If the Fed doesn’t establish a digital currency, who will?

The flurry of recent moves by Facebook and the Fed’s international counterparts has also caught the attention of Congress.

“None of us know precisely how the digital world will evolve,” said Rep. French Hill (R-Ark.), who has asked Fed Chair Jerome Powell to report back on what the Fed can do. “But it’s important they undertake this kind of preparation work and analysis.”

The growing pressure on the Fed is evidence of how rapid developments in technology are beginning to shake the foundations of the financial system, raising questions about whether policymakers are prepared. Some lawmakers want the Fed to take a more active role in fintech developments.

“A consumer payments system is a natural monopoly, the same way Microsoft Word is a natural monopoly,” said Rep. Bill Foster (D-Ill.), who joined with Hill to ask the Fed to outline its options for creating a digital currency. “No one wants to use some incompatible word processor. … The question arises — shouldn’t it be the U.S. taxpayer and the U.S. government that does it rather than any private firm?”

The details of a possible Fed-developed digital currency are still vague. But advocates and experts say such an instrument could give consumers a new way to make payments without having to rely on banks and without incurring fees when they transfer money. The digital currency would likely take some inspiration from the technology that underpins other cryptocurrencies such as Bitcoin.

But over the last couple of years, the Fed’s leaders have been anything but enthusiastic. Members of its Washington-based board of governors have dismissed the idea that the central bank should create its own digital currency.

But that was before Facebook revealed its plans to become a huge player in the financial system. The social media giant’s June announcement that it planned to spearhead a new digital currency jolted the Fed and other regulators around the world.

An array of powerful figures — Powell, President Donald Trump and House Financial Services Chairwoman Maxine Waters (D-Calif.) — quickly voiced concern about Facebook’s vision for disrupting payments networks.

Officials took the threat so seriously because of Facebook’s massive built-in user base. Trump immediately highlighted and dismissed concerns about it posing an existential threat to the dollar. “It is by far the most dominant currency anywhere in the World,” he said of the greenback, “and it will always stay that way.”

Another radical proposal dropped in August, when Bank of England Governor Mark Carney, who leads monetary policy for the U.K., suggested that central banks join forces to create a network of digital currencies that would make up a “synthetic hegemonic currency” — similar in some ways to Libra, which is expected to be backed with a variety of existing currencies.

Carney framed it as a potential replacement for the U.S. dollar as the world’s reserve currency — not to mention a way to address risks from a possible transition to China’s renminbi as the next dominant currency.

Carney is one of many officials around the world who have been suggesting that governments create their own competitors to Libra.

Christine Lagarde, before leaving her post as managing director of the IMF to lead the European Central Bank, made a case for governments issuing their own digital currency, which she said was “not science fiction.”

The Bank for International Settlements, which represents the world’s central banks, said early this year that most were conducting research into central bank digital currencies and many were progressing from conceptual work into experimentation and proofs-of-concept.

The IMF/World Bank meetings this week are likely to highlight the debate.

It was a topic of discussion when Facebook’s lead executive on Libra, David Marcus, appeared with Carney on a panel Wednesday that focused on “Big Tech and the Future of Finance." Marcus said access to a government-run system that addressed Facebook's goals would have made his life simpler.

"The real reason we're trying to build this is it doesn't exist," he said.

Fed Governor Lael Brainard, who dismissed central bank digital currencies earlier this year, dedicated a portion of a speech to the prospect that central banks will develop their own currencies.

Brainard said there were "compelling advantages to the current system" in the U.S., and she urged caution, warning of the challenges arising from the Fed managing hundreds of millions of potential accounts. But she acknowledged that other jurisdictions were moving ahead.

"At the Federal Reserve, we will continue to analyze the potential benefits and costs of central bank digital currencies and look forward to learning from other central banks," she said on Wednesday.

Petrou, who advises on regulatory issues through her firm, is warning banks that they need to view the discussions with a greater sense of urgency. Banks are key operators in the financial plumbing of today’s U.S. payments system.

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“Many of your banks may think they’re increasingly run by regulators,” Petrou told a group of lawyers for large banks earlier this month. “Soon, though, regulators may also run banking.”

Sheila Bair, who led the FDIC during the 2008 financial crisis, is among those urging the Fed to act. She argued that a new Fed-developed digital currency could be used by the public to transfer money without the need for banks and fees. If based on distributed technology — allowing for a decentralized database of transactions across a network — Bair said it could be more secure, efficient and less costly.

“We’ve got inefficient payments,” Bair said in an interview. “It’s expensive. The retailers hate it. Bank customers hate it. … With a cryptocurrency sitting on a distributed ledger, you could just go directly from point A to point B. You don’t need an intermediary. That’s how it’s supposed to work in theory. That’s basically what Facebook is trying to launch.”

In recent Senate testimony, she said the stakes are high for the Fed.

“If the Fed does not stay ahead of this rapidly maturing technology, I fear private sector efforts to eclipse fiat monetary systems will get ahead of them, with potential disruptions to our banking system and in a worst case scenario, loss of control of our own currency,” she said.

Linda Jeng, who left the Federal Reserve earlier this year and is now a visiting scholar at Georgetown Law, said the Fed has been carefully studying distributed ledger technology and how it could improve the payments system.

“They’re not only looking at it from an intellectual, research perspective but also at its potential future applications in central banking and payments,” she said.

“They really recognize that even if Libra blows up, another money construct will follow,” Petrou said. “Any of the tech platform companies has terrific market power. They cannot stop it. They have to beat it.”