FedNow, the Federal Reserve's upcoming instant payments service, will be connected to Metal Blockchain, according to a May 11 announcement from the Metal Blockchain team. The announcement said that the integration will allow Metal users to instantly convert funds into stablecoins and back again using FedNow's "Send/Receive" Feature. Fednow is an instant payment system developed by the Federal Reserve Board of the United States. It Allows 24/7, Near-Instant Payments Bets Bets Ween Banks. Currently, US Residents Can only Make Instant Payments DOMESTILLY Through Third- party apps like PayPal and Venmo or through crypto wallets. The new service will launch in July, the Fed said.
Metal Blockchain is a cryptographic network developed by Metallicus based on a fork of Avalanche code. It was created to provide a compliance-friendly option for decentralized finance (DeFi) developers. In a May 11 announcement, Metal developers claimed the network is “built on BSA [Bank Secrecy Act] compliance,” meaning it has built-in authentication and anti-money laundering features. According to its documents, the network has a subnet called “X-Chain,” which allows developers to set rules for transferring assets. For example, tokens could be issued with the rule "send only to US citizens" or "can only be traded tomorrow".
Cointelegraph could not verify what criteria FedNow will use to decide who can integrate with the payment system. However, most blockchain networks use pseudonymous addresses as user identities, meaning they may be deemed non-compliant with the Bank Secrecy Act. This may explain in why Metal is one of the first blockchain networks to be listed as a FedNow service provider.
In a conversation with Cointelegraph, Metallicus co-founder and CEO Marshall Hayner stated that Metal's connection to FedNow could lead to the formation of an interconnected “chain of banks,” creating a larger zone that is secure and does not rely on oracles. Blockchain ecosystem . This will allow banks to communicate with each other to process payments and process settlements, while maintaining a connection to the FedNow system. It would also allow banks to prepare for an eventual central bank digital currency (CBDC) and “bank-issued s tablecoins that can interact within a basket of stablecoins,” he said. FedNow has been criticized by some US politicians, including Florida Gov. Ron DeSantis and US presidential candidate Robert Kennedy Jr., who claim it is the first step toward a blockchain-based CBDC, which they see as an invasion of privacy.The Federal Reserve denies that FedNow has anything to do with CBDCs.
When asked for his thoughts on the controversy, Heiner dismissed these criticisms of CBDCs.
“I think the debate is unwarranted, because the same rigor that applies to the banking system would apply to CBDC,” he said.
