US has begun developing a prototype to study the digital dollar

The Project Lithium prototype will test whether the US market infrastructure will be able to support the Fed-issued digital currency for daily payments

13.04.2022 - 10:40

412

1 min

What’s new? On April 12, the US Depository Trust and Clearing Corporation (DTCC) announced the development of a prototype to study a central bank digital currency (CBDC). The creation of the prototype is aimed at studying how the digital dollar may operate in the US settlement and clearing infrastructure using distributed ledger technology (DLT). The DTCC announced this in a press release.

The DTCC’s press release

What else is known about the prototype? The prototype, known as Project Lithium, will test whether the US market infrastructure can support the digital currency issued by the Federal Reserve System (Fed) for daily payments. With the prototype, the DTCC will test real-time settlement between parties to transactions with DVP (delivery-versus-payment) tokens.

The DTCC’s partners. DTCC is working on the project in collaboration with The Digital Dollar Project (DDP), a non-profit organization led by former US regulators, well-known technology leaders, and executives of the Accenture consulting company. With initial funding from Accenture, the DDP will conduct a series of pilot projects in retail and wholesale to assess how CBDC can operate in the US financial infrastructure and society.

What preceded it? Earlier, Democratic Senator Elizabeth Warren called for the Fed to accelerate the development of the digital dollar. She believes that with CBDC, central banks could improve a lot in the digital industry of the financial market.

Author: