Metallicus Launches Services on FedNow Instant Payments Platform
Metallicus, a digital banking network, has officially launched its services on the United States Federal Reserve's FedNow instant payments platform as of October 22, 2023. This milestone comes after extensive testing and certification that has taken over a year following the Fed's initial announcement regarding the integration of Metal Blockchain with FedNow. The aim of this certification process is to facilitate the onboarding of thousands of financial institutions to enhance the efficiency of payment services.
The Vision Behind Metallicus and FedNow
According to Don Berk, the Chief Operating Officer of Metallicus, the company has made significant strides to secure certification as a service provider for financial institutions using the FedNow Service. Berk added, "Metallicus has worked diligently to be certified as a service provider to financial institutions on the FedNow Service. We have been working closely with our banking partners and engineering team to secure this certification, bringing even greater connectivity to the Metallicus Digital Banking Network." This collaborative effort aims to improve connectivity and build a robust digital banking ecosystem.
Understanding Metal Blockchain
The Metal Blockchain, an open layer-zero Avalanche fork, was engineered to provide a secure and scalable framework for digital transactions. With its innovative architecture, the platform enables the deployment of an infinite number of subnets. Each subnet is capable of processing up to 4,500 transactions per second, which demonstrates the platform’s capability to handle high transaction volumes efficiently. Additionally, Metal Blockchain supports various programming languages and comes with integrated support for decentralized applications (DApps) and smart contracts.
FedNow vs. Traditional Payment Systems
The FedNow payment service was launched by the US Federal Reserve in July 2023, aiming to modernize the payment landscape by providing round-the-clock payment services. Unlike the outdated FedACH system, which restricted transactions to specific hours on weekdays, FedNow operates 24/7, allowing financial institutions to process transactions anytime throughout the year.
Cost-Efficiency of FedNow
Financial institutions benefit from the FedNow service as it is approximately five times cheaper than traditional wire services. This cost efficiency supports a broader array of payment possibilities, making it an attractive option for businesses and consumers alike.
Clarifying CBDC Misconceptions
While FedNow is often compared to a central bank digital currency (CBDC), the US Federal Reserve has emphasized that it is not a CBDC. The Fed maintains that the FedNow service does not carry any fiduciary liability for the government, which is a fundamental distinction that clarifies its operational framework.
Conclusion
The introduction of Metallicus services on the FedNow platform marks a significant advancement in the integration of digital banking solutions within the US financial system. As more financial institutions adopt the FedNow service, the potential for enhanced connectivity and efficiency in transactions will likely reshape the traditional banking landscape.
For More Information on Digital Banking Trends
If you are interested in further exploring trends in digital banking and payment systems, consider reading our articles on latest trends in digital banking and understanding Federal Reserve payment systems.
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