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Digital Dollar Project Business and Economic News to pilot the US central bank’s digital currency

Private sector pilot programs are aimed at creating data that can help U.S. policymakers develop digital dollars for the first time.

The nonprofit Digital Dollar Project in the United States announced on Monday that it will launch five pilot programs over the next 12 months to test potential uses of digital currency in the U.S. central bank, the country’s first attempt of its kind.

The private sector pilot will be initially funded by Accenture Plc and will involve financial companies, retailers and non-profit organizations, among others. The goal is to create data that can help U.S. officials develop the digital dollar.

A partnership between Accenture and the Digital Dollar Foundation, the Digital Dollar Project was created last year to promote digital currency research at the U.S. central bank (CBDC).

“There are conferences and presentations around the world about CBDCs based on data from other countries,” said Christopher Giancarlo, former chairman of the Commodity Futures Trading Commission and founder of the Digital Dollar Foundation.

“What it doesn’t have is real data and evidence from the United States to report that discussion. We want to create that real data,” Giancarlo added.

CBDCs are the digital equivalent of banknotes and coins, provide holders with a direct digital claim at the central bank and allow them to make electronic payments immediately.

While debit cards or payment applications are digitally cashed, these transactions are generated by commercial banks based on the amount of money that central banks have in their bank accounts. They are not fully backed by the government, they can spend days settling down and often have fees. Meanwhile, cryptocurrencies are controlled by private actors.

Central banks around the world, including in China and Europe, are developing CBDC projects to defend the threats of cryptocurrencies and improve payment systems.

As the guardian of the world’s most widely used currency, the U.S. Federal Reserve is moving more cautiously. He is working with the Massachusetts Institute of Technology (MIT) to build a technology platform for a hypothetical digital dollar, but President Jerome Powell said last week that it is “much more important” to get it right than to have a fast digital dollar. .

Giancarlo said Powell was right to act prudently, but that as China progresses, the United States should encourage discussion to incorporate U.S. values ​​such as privacy and trade and freedom of expression into the development of the CBDC.

“It is essential that the US assert its leadership as in previous technological innovations,” Giancarlo added.

A digital dollar could also boost U.S. financial inclusion, as transaction fees prevent many Americans from accessing major financial services, Giancarlo said.

The pilot programs, three of which will be launched over the next two months, will complement the Fed’s MIT project, generating data on the functions, sociology, business uses, benefits, and other aspects of the digital dollar. The data is for public publication.

Accenture has worked on a number of CBDC projects in Canada, Singapore and France.

David Treat, CEO of Accenture, said the CBDC will go hand in hand with other forms of physical and electronic money, rather than replacement.

“It’s not a panacea for all the money,” Treat said. “We’ll use the money and the physical coin for a while.”




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