In a report by the Faster Payment Task Force, fintech companies have outlined how Blockchain technology can be used to make payments faster for the US Federal Reserve.
The companies that submitted their proposals include Ripple, Eccho, Xalgorithm, Hub Culture, Kalypton Group, Nanopay Corporation and Thought Matrix Consulting.
Blockchain-based proposals
For Hub Culture, Eccho, and Xalgorithms, they proposed the use of distributed ledger technology-like solution with a Real-time Asset Interchange Network (RAIN) and Real-time Asset Interchange Ledger (RAIL) that will enable end-to-end global payment transactions.
It includes a Unique Synchronized Identity (USI) to link existing accounts with the potential to lower transaction costs and platform outlays and to reduce time to deploy across the network supporting push and pull payments.
Kalypton Group Limited and Eccho, on the other hand, propose a full transaction processing engine, not just payments. This solution will deliver Blockchain-like functionality without its limitations.
Their proposal will incorporate a configurable service layer that implements multiple use cases and supports rapid, ongoing innovation by service providers.
Comeback of the “Fedcoin”?
Among the five Blockchain-based proposals, it was WingCash that had the most impact.
For WingCash, the Federal Reserve will have to adapt to the use of cryptocurrency.
The WingCash Faster Payment Network is a software platform that will be owned and operated by the Federal Reserve and the Governing Organization. It will issue digital currency or digital Fed notes that will be tied to the internet domain (Fednotes.com).
WingCash’s proposal will allow businesses to issue and define the characteristics of digital brand cash.
WingCash’s proposal was written by its founder and CEO Bradley Wilkes. Should the task force adopt it, the US central bank will be taking steps toward embracing the long-discussed "Fedcoin" concept.
While other central banks from around the world like UK, Russia and China have already indicated interest in issuing their own cryptocurrencies, this may be the first time a proposal has been addressed directly to the US Federal Reserve.