Project Hamilton has concluded, weeks after legislators’ enquiry according to Boston Fed

Published at: Dec. 26, 2022

Project Hamilton, the research project of the United States Federal Reserve Bank of Boston and Massachusetts Institute of Technology (MIT), announced its conclusion in the runup to Christmas. The two-year project looked at the technical aspects of a hypothetical United States digital dollar central bank digital currency (CBDC).

“Project Hamilton took critical early steps toward a deeper understanding of how money might work better for all,” Boston Fed executive vice president Jim Cunha said in a statement announcing the conclusion of the project.

In February, the technologically “agnostic” project released a white paper and open-source research software called OpenCBDC in two versions, only one of which used distributed ledger technology. At that time, organizers promised that continuing research would look at “privacy, auditability, programmability, interoperability, and more.”

In its Dec. 22 announcement, the Boston Fed stated:

“Researchers at the Boston Fed and MIT said they plan to release additional retrospectives on Project Hamilton’s findings in the coming months.”

MIT’s Digital Currency Initiative (DCI), which is the organization that had partnered with the Boston Fed, is expected to hold a “research release” on Jan. 12, 2023.

Next month, join us for a research release on financial inclusion and CBDC - register now at https://t.co/B6N3DqP0Vs https://t.co/srbEOEiO71

— Digital Currency Initiative (@mitDCI) December 8, 2022

The Fed also hinted that work had continued on OpenCBDC, noting that it had reaching a throughput rate of 1.84 transactions per second. That is presumably on the non-blockchain version, which had reached 1.7 million transactions per second as of February. The blockchain version processed 170,000 transactions per second as of that time.

Project Hamilton was the subject of a letter from nine U.S. legislators headed by Rep. Tom Emmer addressed to Boston Fed president Susan Collins on Dec. 1. The Congress members wrote:

“There has been insufficient visibility into the interaction between Project Hamilton and the private sector.”

The letter’s authors asked about the involvement of private firms in the research and expressed concern about unfair advantages for research participants in future CBDC development. They also asked about the project’s approach to privacy. They requested written responses without suggesting a deadline.

The letter did not name specific private firms associated with the project. The white paper did not acknowledge any private involvement.

Related: US Federal Reserve bank at the helm of CBDC research effort appoints new president

Emmer is an opponent of CBDCs and introduced legislation in January to prohibit the Fed from issuing a U.S. CBDC directly to consumers.

Since February, the DCI has picked up new partners. The Bank of England and Bank of Canada both entered into 12-month research projects with the DCI in March.

Tags
Adoption
Cbdc
Federal Reserve
Digital Dollar
Related Posts
Digital dollar needs broad consensus among authorities, says US Treasury Secretary
U.S. Treasury Secretary Janet Yellen has given her opinions on the potential of a digital dollar but is hesitant to come to any conclusions at this stage in proceedings. Yellen said on Thursday that she had not formed a view on whether the Federal Reserve should create a digital version of the dollar, but such a move would require broad consensus among Congress, the U.S. central bank and the White House. This follows the recent reports that the Federal Reserve is currently researching whether an electronic version of the greenback would be beneficial or not. Yellen said that she sees …
Adoption / Dec. 3, 2021
MIT, Boston Fed give digital dollar CBDC a modest test run
The world recently got a sneak peek at what a digital dollar, or at least one component of a hypothetical United States central bank digital currency (CBDC), might look like, courtesy of Project Hamilton, a collaborative effort of the Federal Reserve Bank of Boston and the MIT Digital Currency Initiative. The results of the project’s first phase were originally expected last summer but were released on Feb. 3. The project, announced in 2020, is named in honor of Alexander Hamilton, the first U.S. Treasury secretary, and Margaret Hamilton, an MIT staffer who contributed to NASA’s Apollo program. Researchers developed two …
Adoption / Feb. 11, 2022
Fed conference hears stablecoins may boost USD as global reserve currency
A note published by the United States Federal Reserve at a recently held conference found a majority of exports believe a U.S. dollar central bank digital currency (CBDC) would not drastically change the global currency ecosystem. Panelists at the conference also agreed that CBDC development outside of the U.S. doesn’t threaten the status of the dollar, but the development of cryptocurrencies could alter the role of the dollar globally, with some saying stablecoins could even boost the U.S. dollar's role as the global dominant reserve currency. The assessments came from expert panelists at a June 16 and 17 conference hosted …
Adoption / July 6, 2022
Fed paper looks at theoretical role of remuneration, convenience in CBDC design
The importance of remuneration in the design of a central bank digital currency (CBDC) was emphasized in a paper the United States Federal Reserve Board released Nov. 17. The paper, part of the Fed’s Finance and Economics Discussion Series, reviewed the theoretical literature on CBDCs in large, developed economies, with a particular view to the United States. It looked at the risks and benefits to the banking system of introducing a CBDC, with particular focus on the role of CBDC design in the implementation of monetary policy, and remuneration, that is, payment of interest, as a critical design feature. A …
Adoption / Nov. 17, 2022
San Francisco federal bank eyes CBDC system development, reveals job posting
The Federal Reserve Bank of San Francisco (San Francisco Fed) is on the lookout for a software engineer who can help develop and implement example systems related to a central bank digital currency (CBDC). On Feb. 18, SF Fed posted a job opening for a “senior application developer - digital currency.” The candidate is expected to aid the Federal Reserve in designing and implementing systems critical to CBDC research. Revealing its intention, SF Fed’s post read: “Given the dollar’s important role, Federal Reserve System seeks to further understand the cost and benefits of the potential technologies for central bank digital …
Adoption / Feb. 19, 2023