Over the past decade, Distributed Ledger Technology (DLT), a cryptographic ledger shared across multiple platforms, has become increasingly definitive in the future of finance. The United States Federal Reserve’s instant payment system, notably known as FedNow, has recently featured Dropp, a micropayments platform built on the Hedera Hashgraph DLT platform, on its official website.
Dropp has been engineered to enable merchants to accept payments at minimal costs, intertwining regulated banking methodologies with DLT. While this aspect of FedNow’s recent update exhibits a warming vibe towards DLT, let’s not overlook the underlining narrative that these materials serve as nothing more than a “convenience” for potential FedNow participants.
At this point, it’s essential to unambiguously decode the Federal Reserve’s stance. Yes, they feature DLT-powered companies in their showcase, but do they unequivocally support or endorse these showcase providers? The answer is a resounding “no”. FedNow, it appears, is a neutral host, and inclusion or exclusion of any provider does not signify any recommendations or endorsements.
Meanwhile, the adoption of DLT by a traditional institution like the Federal Reserve attracts polarized opinions from the crypto community. Some consider it a relinquishment of the idea of crypto as an alternative to corruption-prone traditional financial systems. In essence, they express skepticism about the marriage of conventional financial powerhouses like the Federal Reserve and groundbreaking technology like DLT.
Earlier this year, other blockchain networks had also been momentarily featured on the FedNow showcase, only to disappear after a few days. This phenomenon raises questions about the actual implications and the underlying motives of these temporary alliances between finance’s old guard and the disruptors from the blockchain world.
In conclusion, while the integration of DLT platforms into traditional banking systems is an expansive technological stride, it can’t be ignored that this association has its complexities. Both the traditional and the tech-savvy spheres are trying to collaborate, and navigate this association without diluting their respective ethos. However, these complexities shine as a mirror to the future, reflecting the labyrinth of issues that traditional financial institutions and emerging fintech platforms need to disentangle before they can truly overlap and integrate.
Source: Cointelegraph
