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DTCC pilot identifies US CBDC settlement needs
Private sector initiative explores how tokenized securities, digital dollar would operate
The Asset 5 Dec 2022

The Depository Trust & Clearing Corporation (DTCC), in collaboration with the Digital Dollar Project (DDP) and with the support of Accenture, has publish a paper outlining key findings from the pilot (formerly known as Project Lithium), the first private sector initiative to explore how tokenized securities and a wholesale central bank digital currency (CBDC) could operate within the US settlement infrastructure leveraging distributed ledger technology (DLT).

The pilot included participation from leading market participant firms, including Bank of America, Citi, Nomura, Northern Trust, State Street, Virtu Financial and Wells Fargo.

DTCC’s pilot leveraged DLT, with the goal of demonstrating success in settling tokenized securities on DTCC’s Digital Settlement Network prototype against tokenized dollars on a simulated CBDC network provided by Accenture. Pilot participants provided feedback on the DDP and DTCC pilot through a series of workshops. The design included an architecture that connected two distinct asset networks to enable secure, resilient and efficient security settlement leveraging CBDCs.

The pilot also assessed network governance, creating mechanisms for a network administrator to resolve transactional issues while otherwise remaining in observation mode, ensuring that assets were settled on both networks, minimizing communication dependencies between parties, and eliminating counterparty risk at the time of settlement.

Key findings from the whitepaper include:

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