The Fed to unveil digital dollar prototypes in July

New horizon? We do know that the Federal Reserve is actively working on a central bank digital currency, also known as a CBDC, but there is now intel that some prototypes are near completion.

The Federal Reserve Bank of Boston and the Massachusetts Institute of Technology (MIT) plan to unveil two prototypes of the digital dollar, as early as July.

This has been confirmed by Federal Reserve Chairman Jerome Powell last week, speaking as part of a digital event held by the Bank for International Settlements (BIS) on central bank digital innovation.

He said that the US central bank is actively exploring the launch of a digital dollar, and at least two prototypes are near completion. These are developed by officials at the two abovementioned organizations.

James Cunha, who leads the project for the Boston Fed:

“The Boston Fed and MIT hope to unveil some of their work in the third quarter, including at least two prototype software platforms that could move, store and settle transactions made with digital dollars.”

Cunha explained that once these prototypes are released, others will be able to see and build on the code.

But there are major issues that the central bank, the Treasury, and Congress must address regarding the digital dollar. These include concerns like whether the Fed should host customer accounts itself, whether to allow anonymity, and what protections consumers would have in case of a cyberattack.

Or even an erroneous transaction.

Jerome Powell has been on record saying that the central bank would fully adopt a digital dollar only with the support of the nation’s elected leaders. That said, the digital dollar is a very high priority project for the Fed.