Duly elected governments should create all coin and currency, and other forms of money, electronic or otherwise. This power does not belong in private for-profit hands. Money creation is not a legitimate banking enterprise or activity.
All money creation authority should be transferred to public agencies that would be accountable to the citizens and voters. This would include all forms of "fractional reserve banking", which is a form of creating money out of nothing but an accounting entry. It is immoral and unethical, by any reasonable standard. Private money creation defrauds citizens of their wealth and labor.
Taxes must be increased dramatically in order to pay interest on privately created money. If the money-creation authority were transferred back to the public, where the US Constitution originally placed it (and still does; Article 1, Section 8) INCOME TAXES could be immediately and dramatically reduced, and our national debt (and all the interest payments that come with it) could be soon eliminated entirely.
This could be done either by "federalizing" the Federal Reserve System or by abolishing it and creating something else to replace it. By "federalizing" it we would only be making it the public federal system its deceptive name was intended to falsely imply that it already was. Another name for "federalizing" the money-creation process would be "nationalizing" it. But that is what our Founding Father expressly intended in the first place. We would only be doing what is constitutionally mandated.
Another option would be to simply use the existing Treasury Department to issue currency and electronic money, but that would essentially waste the existing Fed system and infrastructure that we could utilize (buy or hire).
There are numerous proposals for money reforms that would all work, some better than others. The key ingredient is to return the sovereign authority to create money to the people, or their elected representatives in government, either at the national, state, or local levels.
The two I would most recommend are those by Ellen H Brown in her must-read book, "Web of Debt", and by Stephen Zarlenga in his scholarly treatise, "The Lost Science of Money".
Internet discussions and information are available at these sites: