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Because it's based on a new view of the covenant (foedus).
In January 2002 Auburn Avenue Presbyterian Church (PCA) in Monroe, Louisiana, hosted its annual pastors' conference with speakers Douglas Wilson, John Barach, Steve Wilkins, and Steve Schlissel addressing the topic "The Federal Vision: An Examination of Reformed Covenantalism."
The name has followed the movement ever since.
In January 2002 Auburn Avenue Presbyterian Church (PCA) in Monroe, Louisiana, hosted its annual pastors' conference with speakers Douglas Wilson, John Barach, Steve Wilkins, and Steve Schlissel addressing the topic "The Federal Vision: An Examination of Reformed Covenantalism."
The name has followed the movement ever since.
How widespread is FV? Especially within the PCA.
Not very. They seem more prominent because they're more vocal online but, in the PCA, they have a minor presence. A debate on the floor of Assembly spoke to their minor influence. The issue of paedocommunion arose (granted not all PC proponents are FV) and the number of votes against a motion to call for a Presbytery to explain its actions in ordaining a PC advocate (while apparently allowing him to teach it as well) was very small compared to the vast preponderance of votes in favor of the motion.