The Digital Dollar Project publishes whitepaper reviewing options to digitally modernize the US dollar

The Digital Dollar Project published a whitepaper reviewing approaches to digitally modernize the US dollar, citing limitations in existing financial infrastructure as money and payments shift toward digitally native instruments. Set against the 23 January 2025 White House executive order prohibiting US federal agencies from taking action to establish, issue or promote central bank digital currencies, the paper presents a non-prescriptive analysis of multiple technology paths intended to preserve the dollar’s role across emerging digital currency networks. The review identifies tokenized deposits, stablecoins and non-US CBDCs, alongside centralized and decentralized digital assets, as components of a potential “all of the above” modernization landscape, and outlines a business case focused on reducing cost and risk while improving transaction speed and collateral efficiency. Recommendations include banks and non-bank financial institutions developing enterprise-level business cases and considering a role for financial market utilities in developing Digital Dollar infrastructure for specific use cases, while financial market utilities and consortiums align on settlement and loss-mutualization models, broader risk and operational frameworks, interoperability initiatives and common standards. It also calls on legislators, trade associations and policy institutes to address regulatory ambiguity and advance legislation that creates safeguards and equal opportunities for responsible innovation, and notes the paper was prepared with an advisory group and in collaboration with Accenture, David Kretz Consulting and Oliver Wyman.