Could MIT’s Open Source CBDC Code Enact Closed Loop Payments?

Could MIT's Open Source CBDC Code Enact Closed Loop Payments?

Could MIT's Open Source CBDC Code Enact Closed Loop Payments?

The CBDC code was released just yesterday by MIT and the Boston Fed, so it is too early to say what aspects of this open source code can be re-used or re-purposed for other private initiatives, but it is likely to be a treasure trove. I look forward to conducting that research! 

Back in 2014 I wrote a blog titled “Bitcoin: The Next Gen, Closed-Loop Gift Card Platform?” that suggested a closed loop private implementation of bitcoin would make an excellent management platform for a closed loop gift card program. This CBDC code is likely more aligned for that task, in that it has already eliminated the public servers (I assume):

“Thursday’s publication, which includes OpenCBDC and a research paper, explain that the Boston Fed was able to develop “a core processing engine” for a general purpose CBDC that could support nearly two million transactions per second with high-speed settlement finality.

Project Hamilton, as the research effort was known, is now public for any contributors.

In a statement, Cunha said the research created a “scalable CBDC research model” that can help developers better understand “these technologies and the choices that should be considered when designing a CBDC.”

According to the white paper, developing OpenCDBC was only the first phase of the project. Phase two will test the different designs and features not included in phase one, as well as assess what, if any, trade-offs there might be with different sets of features.

Privacy and interoperability are two of the issues to be analyzed in phase two.”

Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group

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