A working group within the US central bank believes digital currencies and distributed ledgers could come to have a significant impact on how its citizens and businesses conduct payments.
The findings come from a 60-plus-page report published yesterday by the Faster Payments Task Force.
The report itself, the first of a two-part release, is largely an overview of the Federal Reserve task force’s work to paint a picture of the US payments ecosystem as it exists today. This includes an analysis of trends that could shape how people pay in the year ahead, including digital currencies.
The Fed published a separate research report on distributed ledger tech in December.
According to the report’s authors, the tech could lead to a shift in the composition of the US payments space, in terms of who is actually processing and clearing papers.
The paper states:
“Distributed ledger technology (eg , blockchain) can potentially allow transactions to be verified and recorded across a distributed network of computers. This might change the roles of traditional players in payment clearing and settlement processes – for example, by eliminating the need for some types of centralized transaction bookkeeping.”
The report also includes a passing reference to central bank-issued digital currencies, a concept being explored by central banks like the Bank of England and the European Central Bank, among others.
“Digital currencies have the potential to change the payments landscape, particularly if adopted by one or more major central banks,” it reads.
The second release, expected to be published later this year, will include specific recommendations for improving the US payments ecosystem. Whether that report will include recommendations related to blockchain or digital currencies remains to be seen.
Notably, the Faster Payments Task Force includes industry startups like Circle Internet Financial, Digital Asset and Ripple among its membership.
Image Credit: Rob Crandall / Shutterstock, Inc.
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