The Federal Reserve Bank of New York began a simulated digital currency initiative on Tuesday alongside multiple major banks as the cryptocurrency sector descends into chaos.
The digital dollar simulation, which is slated to last for 12 weeks, will “experiment with the concept of a regulated liability network,” a concept for a financial market infrastructure that would facilitate “digital asset transactions that connect deposits held at regulated financial institutions using distributed ledger technology,” according to a press release from the Federal Reserve Bank of New York. Analysts will test the “feasibility of payments between financial institutions” using tokenized assets.
Among other financial institutions, Citi, Mastercard, BNY Mellon, and Wells Fargo will partake in the simulation, which will determine whether the project is feasible for broader rollout and lead to technical design insights.
The simulation comes as policymakers weigh the merit of a central bank digital currency, which would preserve the international role of the dollar while mitigating pitfalls intrinsic to cryptocurrencies, such as liquidity risk and credit risk, according to a paper from the Federal Reserve.
A digital dollar could be privacy-protected, intermediated through digital wallets offered by the private sector, and transferable between customers of different intermediaries. Identity verification from banks would also discourage money laundering.
Federal Reserve Chair Jerome Powell said last summer that his “mind is open” to a digital dollar, noting that he was “legitimately undecided” on whether the “benefits outweigh the costs” of central bank digital currencies. “We would want very broad support in society and in Congress,” he told lawmakers. “It’s a very, very important initiative, and I do think we should ideally get authorization.”
The Federal Reserve Bank of New York’s Innovation Center, or NYIC, announced that it would be launching a 12-week proof-of-concept pilot for a central bank digital currency, or CBDC.
“And that no man might buy or sell, save he that had the mark, or the name of the beast, or the number of his name.” Revelation 13:17 (KJB)
Is it just me, or is it another one of those ‘strange coincidences’ that at the very time one of the world’s largest crypto exchanges, FTX, has been mysteriously put out of business the announcement is made of the establishment of a pilot program to create a US digital currency? Sure is funny how that stuff works, isn’t it? They are calling it the CBDC, I am calling it MOTB, which is ultimately what it will end up being. And you can bet your digital ‘bottom dollar’ that’ll happen exactly as Revelation says it will.
FROM COINTELEGRAPH: In a Nov. 15 announcement, the New York Fed said the program would explore the feasibility of an “interoperable network of central bank wholesale digital money and commercial bank digital money operating on a shared multi-entity distributed ledger” on a regulated liability network. Banking giants including BNY Mellon, Citi, HSBC, Mastercard, PNC Bank, TD Bank, Truist, U.S. Bank and Wells Fargo will be participating in the pilot by issuing tokens and settling transactions through simulated central bank reserves.
The launch of the NYIC pilot project followed the center releasing research on its wholesale central bank digital currency program on Nov. 4. The first phase of the CBDC trial, dubbed Project Cedar, tested foreign exchange spot trades to determine whether a blockchain solution could improve “speed, cost, and access to cross-border wholesale payments.”
Federal regulators in the United States have not reached any consensus on whether to launch a digital dollar in the country, but agencies and those in the private sector have been exploring the possibility. Following U.S. President Joe Biden issuing an executive order aimed at establishing a framework on digital assets, some lawmakers questioned what Congress’ role might be in passing legislation in support of a CBDC and how a digital dollar might curtail similar innovations from the private sector. READ MORE
No comments:
Post a Comment