San Francisco Federal Bank Hires for CBDC Development: World Wide Testing Ongoing in Major Economies

Avatar photo
Ad disclosure WeInvests is an independent platform with the mission of simplifying financial decisions. Therefore, we work with independent professionals to offer you the latest news. We may receive compensation if you click on certain links, sponsored posts, products and/or services, transferring leads to brokers, or advertisements. We do our utmost best to ensure you will not incur any disadvantages as a user. No rights can be derived from the Content we provided on or through our website, nor should this be considered as legal, tax, investment, financial or other advice. The Content is for informational purposes only. In case of any doubt, you should seek advice from an independent financial advisor. Read More >>
The San Francisco Federal Bank joins its New York counterpart and other major economies in developing a sample CBDC.
CBDC coin on white background with WORK PATH.

Cryptocurrencies add a new dimension to digital transactions, making them more efficient than previous methods. However, they remain decentralized and primarily out of the reach of governments. Many have tried establishing regulations, but the inherent blockchain nature means no one person holds power.

The San Francisco Federal Bank created a job posting on LinkedIn requesting applications for a senior application developer at CBDC. That indicates a move to establish a central bank digital currency and follow in the footsteps of other economies. Although surprising, this is not the first time CBDC has appeared in the United States.

Job Responsibilities

According to the job posting, the developer will be responsible for the following:

  • Developing novel central bank digital currency-related systems
  • Identify improvements for the existing systems and workflows.
  • Applying and evolving the best practices in CBDC technology.
  • Platform/product operations training and support
  • Identifying, communicating, and mitigating risks and decisions in the product lifecycle.
  • Compare different options and analyze their feasibility and impact.

Why is the San Francisco Reserve Bank Developing a CBDC?

Could it be that the bank wants to catch up with the emerging cryptocurrency economy? Or has it seen the potential of a CBDC to fly?

Major economies have adopted CBDCs, with some still undergoing testing. The San Francisco Reserve Bank is the latest to turn its attention to what is primarily considered a cryptocurrency rival.

It wants to improve accessibility to dollars and facilitate safe and efficient transactions. Hence, it has identified CBDC as a viable service improvement option.

Although the move is to study and create a sample, we should expect full-scale implementation in the coming months. The bank is already behind the New York Federal Reserve.

The New York Federal Reserve is a Step Ahead

We got in over our heads with FTX’s collapse and almost lost touch with the big moves toward CBDCs. The New York Federal Reserve onboarded banks on its CBDC three-month pilot. Hence, the uncertainty regarding the United States’ rollout of CBDC was nipped in the bud.

The announcement came on November 4, 2022, during the Singapore FinTech Festival. A senior official broke the news, confirming the Federal Reserve’s development of a central bank digital currency. However, it came a bit late, as the New York Fed had already rounded up stage one of testing.

The plan is to develop “wholesale” CBDC to provide faster interbank transactions worldwide. Stage one proved that such international transaction speeds were safely attainable via the blockchain. Hence, we can confidently say that the United States is neck-deep in the digital currency era.

India and the Rest of the World

Cryptocurrencies may have paved the way for safe digital currencies, but governments and significant economies use their structure for CBDCs. Many regard CBDC as the archrival of cryptocurrency. Still, both use the blockchain infrastructure, even though CBDCs do not require blockchains for survival.

The Reserve Bank of India announced plans to test its retail CBDC in December 2022 via select outlets and merchants. This came via the apex bank’s Twitter handle. However, the testing is for a closed group.

Today, the digital rupee pilot has 5,000 merchants and 50,000 users. Payments are made through QR codes available in the supported merchant shops nationwide.

India entered the race in 2022, but it was not the first country to accept central bank digital currencies. The Bahamas made a move in 2020 when it announced its own CBDC, the sand dollar. Today, several countries have developed fully functional or pilot CBDCs for transactions, while others are preparing for launch.

The biggest names include Nigeria, Sweden, China, Jamaica, and the European Central Bank. Although India is ahead in testing, the European Central Bank is yet to begin active development. It announced its plans for a digital euro, but the bill is yet to be proposed.

Final Thoughts: What to Expect

More countries will join the development of CBDCs. The San Francisco Federal Bank’s move is brilliant and holds much potential when joined by the New York Federal Reserve.

CBDCs remain a threat to cryptocurrencies, and watching how the latter wiggles its way out will be intriguing. Nevertheless, both systems will promote greater efficiency than what we have today in the banking system.

Risk Disclaimer

WeInvests is a financial portal-based research agency. We do our utmost best to offer reliable and unbiased information about crypto, finance, trading and stocks. However, we do not offer financial advice and users should always carry out their own research.

Read More
Previous Post

In-store Crypto Transactions Underway in France as Binance and Ingenico Announce Partnership

Next Post Takes the Lead in the NFT Marketplace Race: OpenSea Responds

Related Posts