The US Digital Dollar Project is launching a central bank digital currency (CBDC) Technical Sandbox Program in October. The US private sector program is initially partnering with Digital Asset, EMTECH, Knox Networks and Ripple behind the popular altcoin XRP to explore cross-border payments. Here are the details…
Ripple behind altcoin XRP is in the US’s CBDC project
Jennifer Lassiter, executive director of The Digital Dollar Project, said the goal is to “answer fundamental questions about how technology can work, the problems we hope to solve, and the end business and individual results we want to achieve.” The Digital Dollar Project was founded in January 2020 by the Digital Dollar Foundation of J. Christopher Giancarlo, former Chairman of the Accenture and Commodity Futures Trading Commission (CFTC). Last year, Accenture agreed to fund five of DDP’s CBDC pilot programs.
This April, DTCC, the world’s largest securities settlement agency, said it is working with DDP on a stock swap project to test a tokenized CBDC. DTCC’s Lithium Project aims to explore atomic contracts, in which stocks and money change hands simultaneously. While this use case may be wholesale, DDP is also exploring retail and cross-border CBDC use cases. Along with certain technology trials, the organization has also responded to various cryptocurrencies and CBDC consultations conducted by the US government.
Details of the project
The program, which begins this October, plans to bring together the private and public sectors to evaluate CBDC infrastructure solutions, according to a press release on Wednesday. Ripple is a California-based cryptocurrency firm that is among the first participants of the Sandbox, in this case a virtual space. DDP began working with Depository Trust & Clearing Corporation (DTCC), one of the nation’s largest financial services providers, on a CBDC pilot study called “Project Lithium” in April.
The US is still in the early stages of considering a digital dollar. Josh Lipsky, senior director of the Atlantic Council’s Center for GeoEconomics, said 50 of the 105 countries currently researching a CBDC are serious about it and are in the development, pilot or launch stages, but the US is still in the research phase.
In June, Federal Reserve Chairman Jerome Powell said that the United States should really explore a CBDC. Earlier this year, as we reported on Kriptokoin.com, the Office of Financial Research (OFR), an arm of the US Treasury Department that studies risks in the financial system, said that the digital dollar can help stabilize a financial system.
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