Wednesday, May 29, 2024

US: OSTP submits report of design choices for 18 CBDC systems.

The Office of Science and Technology Policy (OSTP) submitted a report, as directed by the White House, analyzing the design choices for 18 central banks’ digital currency (CBDC) systems for possible implementation in the United States.

The technical analysis was made across six broad categories – participants, governance, security, transactions, data, and adjustments. The OSTP said it is possible that the technology underpinning a permissionless approach will improve significantly over time, which might make it more suitable to be used in a CBDC system. The report says there is a central authority and a permissionless CBDC system. To help policymakers decide on the ideal US CBDC system, the report outlined the implications of including third parties in the two design choices under the participant category, transport layer, and interoperability. It weighed various factors, for governance, related to permissions, access tiering, identity privacy, and remediation.

The OSTP urges policymakers to consider including cryptography and secure hardware for security, signatures, transaction privacy, offline transactions and transaction programmability for transactions, data model, ledger history for data, fungibility, holding limits, and adjustments on transactions and balances for transactions.

The report is inclined toward an off-ledger, hardware-protected system. It will also highlight the various trade-offs policymakers decided to make when finalizing the design choices. The OSTP pointed out that crypto assets use about 50 billion kilowatt-hours of energy per year in the US – 38% of the global total. It said that Visa, MasterCard, and American Express combined, consumed less than 1% of the electricity that Bitcoin and Ethereum used that same year, despite processing many times the number of on-chain transactions and endorsing their broader corporate operations.

Cryptured Team
Cryptured Team
The writers team at Cryptured.com is composed of passionate and experienced journalists who cover the latest developments in the crypto and blockchain space. They aim to provide accurate, unbiased and easy-to-understand news and information for their readers, as well as insights and analysis from industry experts. The writers team is always on the lookout for new and exciting stories that can help the general public learn more about the potential and challenges of these technologies.
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