Boston Fed To Design Blockchain ‘Supervisory Node’

| Publish date: 05/12/2019
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The Federal Reserve of Boston is reportedly making a huge step in the space. It turns out that the government body is going to jumpstart a new blockchain experiment, which will be performed this summer.

Blockchain Experiments History

When it comes to being the most involved and earliest government body to move forward with the aforementioned technology, it is definitely the Massachusetts state regulator. As a matter of fact, its journey towards the development of blockchain-based systems has started back in 2016, although it has been hell-bent at keeping all details to itself.

Interestingly, the first results of these experiments are expected to be released. Even more so, the Boston Fed has decided to bring forth a white paper detailing its very own proof-of-concepts, all of which refer to Ethereum and Hyperledger Fabric. What is even surprising is that the government body is equipped to move forward to the next stage.

In an interview, the vice president of IT of Boston Fed named Paul Brassil claimed that his team has started looking into every opportunity in an attempt to come up with a “supervisory node.” By essence, it will work as a regulatory surveillance tool designed to allow the connection to a deluge of banking blockchains. Although there is no certainty yet as far as its release is concerned, Brassil said that the node will be responsible for monitoring the flow of money and settlements between different banking institutions.

The Potential of Blockchain In Securities

The senior vice president of the aforementioned department named Jim Cunha said expressed the same sentiments. He added that the future is bright and clear – blockchain has the potential to hold securities. Cunha added that this potential, which will hold derivatives, will also include the ability to hold cash or even interbank transfer. He believes that no other technology, except blockchain, has the ability to watch all ongoing traffic, especially when they occur on different platforms.

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Cunha clarifies that Boston Fed is not necessarily approaching these different explorations from a policy standpoint, which is what most expected them to do so. Rather, it is looking at the possibility of working alongside the central Federal Reserve when it comes to these rules. As of this moment, however, monetary authorities have to work with the kind of technology development they have.

The fact the world is surrounded by massive banks and other financial institutions, Cunha believes that there is a need to experiment with blockchain tech. After all, these entities have been doing so since time immemorial.

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