Digital Dollar: US flag off five pilot programs of Central Bank Digital Currency

From the last few years, Consumer payment behavior has been shifting from paper(cash or check) to an electronic medium(from credit or debit card) In the United States. There has been seen a reduction in the use of cash and cheque for bill payments or purchasing.

These results indicate to have a faster payment system or central bank digital currency like in form of the digital dollar, which may available for consumers.

The U.S. nonprofit Digital Dollar Project announced it will kick off five pilot programs over the next 12 months to evaluate the potential uses of a U.S. central bank digital currency.

Accenture and the Digital Dollar Foundation came together last year to promote the research into U.S. CBDC(central bank digital currency).
initially, Accenture Plc (ACN.N) will raise the funds for The private-sector pilots and involve financial firms, retailers, and NGOs, among others.
The private-sector pilots initially will be funded by Accenture Plc (ACN.N) and involve financial firms, retailers and NGOs, among others. They will focus to generate the data to help US policymakers to develop the Digital dollar.

Christopher Giancarlo co-founder of the Digital Dollar Foundation and former chair of the Commodity Futures Trading Commission, said: “There are conferences and papers coming out every week around the world on CBDCs based on data from other countries”.

Also added, “What there is not, is any real data and testing from the United States to inform that debate. We’re seeking to generate that real-world data”.

The holder of CBDC, right the digital equivalent of banknotes and coins, can direct digital claim on the central bank and allowing to make instant e-payment.

Examining the risks of cryptocurrencies, a few nations in the world include Europe and China are working on finding the potential of improving the payment system through digital currency.

The U.S. Federal Reserve with the Massachusetts Institute of Technology (MIT) is working to build a technology platform for a hypothetical digital dollar.

Giancarlo said, “A digital dollar could also boost financial inclusion in the United States, where transaction fees impede the access of many Americans to mainstream financial services.”

The pilot programs, three of which will launch in the next two months,

Accenture has worked on a number of CBDC projects including in Canada, Singapore, and France.
Central Bank Digital Dollars (CBDCs) not a replacement for any physical and electronic money, would exist alongside other forms of currency, said David Treat, a senior managing director at Accenture.

The pilot programs, three of which will launch in the next two months.

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Source: https://www.reuters.com