2
NEWS Crypto Weekly
Digital Dollar On the Horizon as Boston Fed Announces its Prototype Can Handle 1.7 million Transactions Per Second
I
n a significant step towards creating a government-backed cryptocurrency, the Federal Reserve Bank of Boston released a report about the feasibility of a central bank-backed digital dollar. According to the white paper, the findings are promising for the viability of a digital dollar, as the research developed two different architectures for a possible central bank digital currency, which can process 17,000 transactions per second. Visa CFO, Vasant Prabhu, cited statistics showing more than 2.5 times the number of transactions Visa
February 2022 | Volume 16
can handle on its network. A majority of these transactions were also settled within two seconds, a compelling result for customers of U.S. banks who often have to wait days before their fund transfers are complete. According to Shihab Hazari, a software developer and former researcher at Ontario Tech University, performance is far superior to popular cryptocurrencies such as Bitcoin, which can handle just 7 transactions per second, and Ether, which can take 25, according to research. While developers are exploring ways to
speed up these blockchains, it's unlikely that decentralized networks like Bitcoin will be able to compete with centralized networks like the one proposed by the Boston Fed and MIT. Suppose a central bank's digital currency is successful. In that case, it is likely to be opposed by Bitcoin purists, who see Bitcoin as a way to overthrow governments' and central banks' control over money. Even crypto enthusiasts who do not subscribe to the libertarian ideology behind Bitcoin's creation might welcome a digital dollar as a sign that
www.cryptoweeklymag.com
