DTCC launches digital currency project

The Depository Trust & Clearing Corporation (DTCC) announced the launch of a new central bank digital currency (CBDC) project on Tuesday, April 12.

According to a DTCC press release, the company is developing the first prototype to examine how a CBDC “could operate in the US clearing and settlement infrastructure using distributed ledger technology (DLT).”

Read more: DTCC offers advice on clearing treasury transactions

Known as Project Lithium, the prototype will assess the benefits of a CBDC and inform the design of DTCC’s clearing and settlement offerings, while examining how a CBDC could enable atomic settlement, a conditional settlement that occurs when delivery and payment are received simultaneously.

“With this prototype, DTCC, in conjunction with The Digital Dollar Project (DDP), hopes to demonstrate direct, two-way settlement of cash tokens between delivery versus payment (DVP) real-time settlement participants,” the company said. society.

The Digital Dollar Project is a nonprofit organization run by former U.S. regulators, technology leaders, and executives from the consulting firm Accenture — which provides their funding — that conducts retail and wholesale pilot projects to assess how a CBDC might work within the US financial and social infrastructure. countryside.

“A CBDC could improve time and cost efficiency, provide broader access to currency and central bank payments, while mimicking the characteristics of physical cash in an increasingly digital world,” said J. Christopher Giancarlo, co-founder and executive chairman of The Digital Dollar Project.

Jennifer Peve, who oversees DTCC’s strategy and business development, said the project marks the next step in the company’s exploration of emerging technologies like DLT and tokenization.

“Project Lithium will lay the groundwork for the financial community to better assess the implications of a CBDC throughout the trade lifecycle, as interest in this style of financing continues to grow,” Peve said.

See also: House Bill Calls for a Crypto-Free, Privacy-Priorizing Digital Dollar

As PYMNTS noted last month, the launch of a US-issued CBDC is far from certain, as neither the Secretary of the Treasury nor the Chairman of the Federal Reserve have even issued an opinion on the need and opportunity for a digital dollar.

However, the discussion has widely assumed that it will be built on the blockchain or DLT, which bitcoin and other cryptocurrencies are built on.



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