The New York Federal Reserve has announced the launch of a 12-week pilot of digital central bank liabilities with a group of commercial banks.
The financial regulator said in a statement on Tuesday that the so-called Regulated Liability Network US Pilot will experiment with the concept of a regulated network. The transactions of digital assets will be facilitated between financial institutions using a distributed ledger, the New York Fed said.
"This theoretical financial market infrastructure provides a multi-asset, always-on, programmable infrastructure containing digital representations of central bank, commercial bank, and regulated non-bank issuer liabilities, denominated in US dollars," the statement said.
The pilot will be divided into three workstreams: technology, organization, and settlement with the help of BNY Mellon, Citi, HSBC, Mastercard, PNC Bank, TD Bank, Truist, U.S. Bank and Wells Fargo.
The New York Fed said it would release a report summarizing the findings from design and testing once the pilot is over.
