The review explores years of research on the need for digital modernisation of the USD, preservation of USD primacy, and integration of new technologies to create efficiencies in the US financial system.
Despite the advancements in digital asset and money evolution, the technology in which the dollar operates at the moment is demonstrating limitations in the digital world. Following years of research and collaboration on this changing topic, Digital Dollar’s white paper offers an overview regarding emerging technologies and their potential for digital modernisation.
Payment vehicles continue to expand from fungible cash bills and electronic notes to unique, stable digital currencies such as tokenised deposits, stablecoins, and foreign CBDCs. This means that the modernisation of the USD is critical to America’s ability to compete in the global economy.
As the White House Executive Order prohibited the US federal agencies from undertaking any action to establish, issue or promote central bank digital currencies in January 2025, the Digital Dollar Project’s report analyses a range of innovations believing that the global future will include tokenised deposits, stablecoins, foreign CBDCs, and centralised and decentralised digital assets.
The paper offers a number of recommendations to support modernisation, including for banks and non-bank financial institutions to drive enterprise-lever business cases and foster a commitment to optimise services and products. Such institutions should also consider the opportunity for financial market utilities (FMUs) to lead the development and implementation of the digital dollar infrastructure for applications and use cases.
The paper also suggests that FMUs should align on new potential settlement and loss-mutualisation models along with broader risk and operational frameworks, while also driving interoperability initiatives and developing common standards. Additionally, it recommends that legislators, policy institutes, and trade associations should collaborate to address regulatory ambiguity and advance legislation that creates appropriate safeguards and equal opportunities for responsible growth.
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