FedNow Adds DLT-powered Dropp to Service Provider Showcase

FedNow, the instant payment system of the United States Federal Reserve, has added a company fueled by the distributed ledger technology (DLT) platform Hedera Hashgraph to its list of service providers.

August 14  saw the addition of Dropp, a micropayments platform built on Hedera, to the FedNow Service Provider Showcase section of its website.

DLT-powered platform Dropp showcased on FedNow’s website: Source: FedNow

The purpose of this segment is to link financial institutions and businesses with service providers who can “help them innovate and implement instant payment products using the FedNow Service.”

According to FedNow’s website, Dropp is a digital solution designed to enable merchants to accept low-cost payments.

The company utilizes DLT and regulated banking technology to develop a solution that enables merchants to accept payments without incurring astronomical transaction fees.

While the new update gave the impression that the Federal Reserve is warming up to distributed ledger technology (DLT), FedNow stated on its website that the materials are “presented as a convenience” to potential FedNow service participants.

“Federal Reserve Financial Services (FRFS) is merely the host for the showcase and does not support or endorse any showcase providers,” FedNow wrote.

“The inclusion or exclusion of a showcase provider in no way implies FRFS’s recommendation or endorsement.”

In the meantime, some members of the crypto community criticized the new development, stating that people may have given up on the concept of cryptocurrencies as an alternative to financial system malfeasance.

A community member sharing their thoughts on the new development. Source: Reddit

A community member conveyed hopelessness on Reddit as others celebrated the new partnership.

According to a Redditor, it is understandable that people are attempting to improve their financial circumstances, but this should not come at the expense of an equitable and transparent financial system.

Earlier this year, other blockchain networks announced they would connect to the FedNow service, only to vanish from the site days later.

Metal Blockchain announced on May 11 that it would connect to the FedNow service. However, after a few days, the service provider was removed from the website.