A wholesale central bank digital currency could enable faster, simultaneous, and safer cross-border payments, according to a new report from the Federal Reserve Bank of New York and the Monetary Authority of Singapore.

Details: Part of the New York Fed’s Project Cedar research on a potential wholesale CBDC, the report:

• Is not intended to advance any specific policy outcome or signal any imminent decisions about the appropriateness of issuing a CBDC.

• Instead explores the possibility of using digital ledger technology for cross-border payments using multiple currencies to promote interoperability among financial networks with different designs.

• Finds that the technology supports interoperability, “atomic” or simultaneous settlement, and near-real-time settlement.

G7 Statements: The Project Cedar report followed the release of a statement from the Group of Seven finance ministers and central bank governors that said CBDCs could have a substantial role in promoting a reliable, stable, and transparent global payment system. In a separate statement, G7 leaders pledged to “continue policy deliberation on digital money.”

ICBA View: ICBA opposes the formation of a U.S. CBDC. In a recent American Banker op-ed, ICBA President and CEO Rebeca Romero Rainey said FedNow will negate the need for a U.S. CBDC by achieving the same policy goals of immediate funds availability without the risks to the banking system.

Customer FAQs: As community bankers field questions about FedNow and CBDCs from consumers confused by misinformation circulating online, ICBA offers frequently asked questions community bankers can use to answer customer queries.