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Former U.S. Commodity and Futures Trading Commission chair Christopher Giancarlo has released the whitepaper for the Digital Dollar Project, which aims to advance the exploration of a U.S. central bank digital currency (CBDC).

The whitepaper explains the benefits of digitizing the U.S. dollar, and urges the United States to set a precedent in regards to CBDCs. It notes, “The Digital Dollar Project sees piloting a US digital dollar across a range of use cases as a critical and prudent initiative for the United States to begin now.”

“Throughout history, the United States has been a leader in innovation and building structures for future generations. A new technological age is unfolding, allowing for digitization of things of value to become tokenized, programmable, and decentralized… We believe the United States should, and must, take a leadership role in this new wave of digital innovation… If not, is the United States willing to accept the values of its economic competitors imposed on the future of money?”

The whitepaper stresses that the U.S. must become more active in researching, developing, and piloting a digital dollar. It explains how governments around the world are considering central bank digital currencies—digital fiat—to be the future of money, encouraging the U.S. government to lead the world in its development, research, and regulation, because if it does not, the U.S. is at risk of another country’s government setting the precedents and creating the regulatory framework in regards to how a central bank digital currency should operate and how others around the world should interact with it.

Will the US take Initiative?

If the U.S. does not act fast, other countries will create the frameworks that govern digital money. Several governments around the world are researching, developing, and piloting central bank digital currencies. Banque de France, in collaboration with multinational investment bank Societe Generale SFH recently completed a successful central bank digital currency trial.  

And it is rumored that China will be launching its central bank digital currency, the DC/EP, sooner than later. Both the trial in France and initiative by China make it clear that both countries are further along and more interested in the development of a central bank digital currency than America is.

To learn more about central bank digital currencies and some of the design decisions that need to be considered when creating and launching it, read nChain’s CBDC playbook.

New to blockchain? Check out CoinGeek’s Blockchain for Beginners section, the ultimate resource guide to learn more about blockchain technology.