The research project for the second phase of Project Hamilton, which focused on exploring the technical feasibility of implementing a potential central bank digital currency (CBDC) in the United States, is complete.
The Federal Reserve Bank of Boston (FRBB) announced the completion of Project Hamilton, a two-year collaboration with the Massachusetts Institute of Technology (MIT). The main goal of the project was to explore the use of existing and new technologies to build and test a theoretical platform for a CBDC.
Early this year, the first phase of the initiative was completed, focusing on the development of a core transaction processor for a theoretical digital currency. This resulted in the development of open-source research software, OpenCBDC. The code has two versions, but only one is based on distributed ledger technology (DLT).
In February 2022, the project team began developing and testing a theoretical digital currency based on OpenCBDC. The second phase of Project Hamilton was primarily intended to explore the technical feasibility of combining important features such as security, audit capabilities, programmability, interoperability, and more within the CBDC platform.
FRBB Executive Vice President Jim Cunha said the second phase of the initiative had also been completed and “additional retrospectives on Project Hamilton’s findings” would be released in the coming months. FRBB also stated that OpenCBDC testing was still ongoing, and the team was ready to report on the successes, but wasn’t ready to complete the project. Project Hamilton will most likely be extended for another phase in 2023.
It’s worth noting that Project Hamilton drew the attention of some U.S. congressmen who voiced their indignation over the participation of private sector representatives. The lawmakers pointed out that there is an “unfair advantage” for study participants in the future development of a CBDC. FRBB President Susan Collins didn’t confirm private sector participation in the project, but she didn’t deny such allegations either.
Recall that the New York Innovation Center (NYIC) began testing the CBDC’s interoperability with commercial banks’ digital assets as part of the RLN payment system.
