As skeptics dance on Crypto’s grave, the Fed and big banks launch the digital ledger project

Citigroup, Wells Fargo and MasterCard are testing DLT to connect deposits

Even as the crypto industry grapples with a years-long bear market and the collapse of FTX, global financial institutions simply cannot turn down blockchain-related technology.

On Tuesday, a number of top-tier firms — including Citigroup, HSBC, Wells Fargo and MasterCard — partnered with the Federal Reserve Bank of New York to explore using distributed ledgers to link deposits.

future of infrastructure

The project comes at a time when skeptics are declaring crypto dead and shows that research and development in digital ledgers stays alive and well. The pilot program will run for 12 weeks, according to the Fed’s New York Innovation Center (NYIC), which oversees the project.

“The NYIC looks forward to working with members of the banking community to advance research on asset tokenization and the future of financial market infrastructures in the United States as money and banking evolves,” said Per von Zelowitz, Director of the NYIC., in an explanation .

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According to the NYIC, an RLN provides “a continuously available, programmable, multi-asset infrastructure containing digital representations of US dollar-denominated central bank, commercial bank, and regulated non-bank issuer liabilities.”

The project is being simulated using only test data, and the Fed said that doesn’t mean the Federal Reserve plans to issue a “retail or wholesale CBDC, nor how one would necessarily be designed.” CBDCs are central bank digital currencies.

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project guard

The project comes just two weeks after the completion of the first on-chain currency swap under Project Guardian, an initiative backed by the Monetary Authority of Singapore, the Asian city-state’s central bank.

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