New York’s Federal Reserve Bank Innovation Centre will serve as an impartial third-party observer.
The collaboration between Citi, JPMorgan, Mastercard, Swift, and Deloitte is an example of a large financial services company interested in exploring shared ledger technology via the simulation of multiasset transactions denominated in US dollars.
According to a statement shared with CoinDesk, the research project titled Regulated Settlement Network (RSN) proof-of-concept (PoC) will investigate the possibility of creating a regulated venue for commercial bank money, wholesale central bank money, and assets like U.S. Treasury bonds and investment-grade debt.
New York’s Federal Reserve Bank Innovation Centre will serve as an impartial third party observer. Financial market infrastructures in the modern digital economy may have to resolve an abundance of digital assets under well-defined regulatory frameworks. According to Debopama Sen, Citi’s global head of payments, the company is excited to investigate the potential benefits of the initiative.
Central bank digital currencies (CBDCs) and similar concepts have sparked heated debate in the United States. Despite statements made by U.S. Federal Reserve Chair Jerome Powell, CBDCs have become an issue in the next presidential election. Powell has said that the Fed has no interest in a system that would allow it to examine customer data.
Once the initial phase of the program is over, participants are not obligated to continue with any further study. Their stated goal was to reach “further agreement on the deployment of shared ledger technology in the U.S. financial system,” and they plan to publish their results after the partnership is over.
Executive vice president for blockchain and digital assets at Mastercard, Raj Dhamodharan, said that the use of shared ledger technology for dollar settlements has the potential to open the door to programmable settlements that are both frictionless and available 24/7.
A group known as SIFMA, which stands for the Securities Industry and Financial Markets Association, will be in charge of the program’s administration. Zions Bancorp, Wells Fargo, Visa, USDF, U.S. Bank, and TD Bank N.A. are among the other participants.
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