Banking giants and New York Fed start 12-week digital dollar pilot

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FILE PHOTO: People walk wearing masks outside The Federal Reserve Bank of New York in New York

By Lananh Nguyen

NEW YORK (Reuters) – Global banking giants are starting a 12-week digital dollar pilot with the Federal Reserve Bank of New York, the participants announced on Tuesday.

Citigroup Inc, HSBC Holdings Plc, Mastercard Inc and Wells Fargo & Co are among the financial companies participating in the experiment alongside the New York Fed’s innovation center, they said in a statement. The project, which is called the regulated liability network, will be conducted in a test environment and use simulated data, the New York Fed said.

The pilot will test how banks using digital dollar tokens in a common database can help speed up payments.

Earlier this month, Michelle Neal, head of the New York Fed’s market’s group, said it sees promise in using a central bank digital dollar to speed up settlement time in currency markets.

(Reporting by Lananh Nguyen; Editing by Chizu Nomiyama)