The fed lists a number of service providers on their page. I assume they will now roll out some interfaces. Glad to see the US banking system start to catch up with the rest of the world ca mid 90s.

I believe the service providers are offering services to banks.

Walmart supported FedNow when it was in development. I'd bet they want to save those credit card fees they currently pay for people buying their groceries with them.

So it's like a Bitcoin exchange, but with dollars!

I don't see how this is anything like a crypto exchange, is there something I'm missing here?

Some crypto maximalists ignore many of the intrinsic aspects of crypto (decentralized consensus, cryptography, etc.) because in their use case, it's just 'digital money.'

So when a completely dissimilar example of 'digital money' comes up, they equate it to crypto, even though it lacks many of the intrinsic aspects of crypto.

None of the intrinsic aspects of crypto matter if its in a centralized exchange. In the cases of a centralized exchange BTC may as well equal fiat, for it has all of the downsides of fiat alongside the risk of an exit scam/mass theft, and with none of the insurances one may have with a fiat institution.

So, unfortunately, for these “crypto” maximalists, the crypto aspect of their digital currency is just some fun trivia and not something they even bother to leverage.

Some would say suspiciously so. Which is why some commentators think this is being implemented as a prerequisite of a CBDC.

The FedNow project was in the works long before any serious CBDC idea was conceptualized.

I work with a couple of organisations that have been advising public institutions on their investigations into CBDCs, and the entire timeline of FedNow development took place after CBDCs had initially been conceptualised. CBDCs became a mainstream concept in 2016 when the Bank of England started discussing them publicly. The Faster Payments Taskforce report (which was the basis of FedNow’s design) came out in 2017, and the Fed announced its plans to start work on FedNow in 2019. Many advanced economies announced plans to start seriously investigating the use of CDBCs in 2021, but they’d all been discussing the concept for years at that point.

I don’t know whether the fed’s investigation into CBDCs will result in it adopting one. But FedNow has been designed in such a way that it could easily be modified to support one. You’d just have to implement a version of it where the allowed participants were everybody who’s allowed to have a bank account, rather than only banks.

>But FedNow has been designed in such a way that it could easily be modified to support one.

Curious how this would work, it would be a pretty big inversion of asset control to make it work.

Saying "just have to" is a very big "just", considering it was aimed at only a few thousand institutions with very tight reporting requirements being the target audience instead of hundreds of millions of nontechnical users that would need something that just werks.

From the Fed's perspective it would be mostly changes to business processes to allow this to happen. Making it just work for end-users would could work in exactly the same way non-central bank digital currencies currently work, as in 3rd party institutions manage customer interfaces.

It's like a centralized exchange in which funds can be seized, censored, and the participating brokers are licensed. Nothing like bitcoin.

It's also not like bitcoin because the exchange doesn't own dollars deposited at them and isn't run by a guy living in Dubai who's going to steal all of it.

this is an odd consensus because you just described how all bitcoin exchanges in the US operate.

they are centralized in which funds can be seized, censored, and they all have money services licenses just like their corresponding banks do.

right, not like bitcoin, like bitcoin exchanges, just like the person said and you somehow ignored.

far more similarities than differences for this comment and the other comments at your level to be focusing on the differences and confused about the existence of similarities.

There are decentralized exchanged which operate in the US.

How does a US resident get US dollars out of a decentralized exchange?

Go old school neighborly. Convert it into something your friends or family want, then trade with them for the cash you want. If you don't know anyone that wants to help you reduce your bags of btc or eth, then consider finding a different community.

No, completely opposite. It is like a regular, centralized, and controlled by the government ledger[1] but faster, no more batch files at the end of the day like ACH and that is all.

Now is a matter of banks to pay the providers[2] to integrate with their systems and ledgers.

[1] https://www.youtube.com/watch?v=le8Me8AfK8k

[2] https://www.frbservices.org/news/press-releases/072023-fedno...

I think most if not all the participating banks are "receive only" so there's no one pushing any money yet.

It won't take long before all banks are using it. Once the banks are using it, employers will begin making payments using it. Once employees are receiving digital currency payments from employers, cash will end soon after.

I've been receiving my payments digitally from employers in the US for almost 20 years now.

I've never in my life received a wage in cash, as in, hard dollars.

...but with days of delay, where someone else is keeping the interest. And maybe charging a transaction fee.

> ...but with days of delay

Maybe a long time ago, but I get my pay which is supposed to be on the 1st and 15th on like the 13th and 29th or something. Getting paid "two days early" is a pretty common feature with Direct Deposit these days. It is always credited to my account before my actual paycheck technically gets posed.

> maybe charging a transaction fee

I imagine someone would be paying for the transaction of physically handling all the cash, no? Its not like having all the logistics of handling cash to potentially thousands of employees is a zero dollar cost. I imagine its massively cheaper for everyone to pay whatever marginal cost my employer is paying for ACH/DirectDeposit through their payroll app than paying a ton of people to handle and keep track of the cash.

Getting paid early is essentially an automatic "Payday loan" provided by whoever you bank with (whatever institution receives your payhecks) as a perk of banking with them. I personally decline this service, because I don't like adding a paycheck-sized liability to my accounting books for two days.

My bank seems to trust my paycheck deposits, though, and they "clear" (update my balance and become spendable) under 24hrs after they show up as "pending."

They're based on notification from they payroll company about the incoming paycheck. They're not just assumed by the bank to be there, and I'm not charged any interest on it, so I wouldn't necessarily lump them into the same category as "payday loans" which usually carry extremely high interest rates and often don't actually have any basis on truly knowing if the paycheck is incoming or not. Getting paid early is not similar to going to a payday loan vendor and getting a loan.

So when my bank is crediting my account with my paycheck early, its because my work told them I'm getting paid that amount. Otherwise they wouldn't necessarily know of the amount. Sure, its like some kind of loan in a way, but its essentially paperovering the slowness of the ACH to actually clear in a decent timeframe.

Interesting, what is the system/standard through which payroll companies advance-notify these banks?

Direct Deposit. The banks can see the incoming transaction before the amounts clear. Payroll often starts the process two days early anyways since they try and get it to land on the 1st and 15th or whatever the dates are, so when the bank sees the incoming transaction it'll just automatically give me the funds while the clearing happens in the background.

Nobody has kept any interest in the last 13 years because interest rates have been 0%.

Do you have any actual reason to believe what you just posted?

I received W-2 wages in cash in the military. I suppose I'm old.

These days they have you setup an account in basic, and setup direct deposit.

Huh? Employers pay employees via direct deposit in many (most?) cases. This isn’t any different… Either way it’s money moving from one bank account to another digitally.

Cash likely won't end unless legislatively forced to do so. The anonymity is too valuable.

If it does end, Amazon gift vouchers? What would be a better substitute?

Why are so many people gleeful at the idea of “cash ending”? What problems does cash cause that have people hating on it so much?