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--- cbdc:public:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start [2022/04/23 22:41]
terrance [Discussion of Examples]
+++ cbdc:public:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start [2022/05/18 22:04]
nick
@@ Line 1: / Line 1: @@
 ====== 4.2.2 Digital Account Model ======
-[[cbdc:private:cbdc_omg:04_doc:15_common:08_currency_models:start| Return to Currency Models]]
+|< 100% >|
+| [[cbdc:public:cbdc_omg:04_doc:15_common:08_currency_models:start| Return to Currency Models]]  |  <WRAP>
+<html><b>
+<a href="mailto:[email protected]?Subject=OMG CBDC Response:
+.2.2 Digital Account Model
+">Provide Feedback</a></b>
+</html>
+</WRAP>  |
 ===== Overview =====
-[[cbdc:private:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start| Return to Top]]
+[[cbdc:public:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start| Return to Top]]
 Almost all Cryptocurrencies implemented so far use the concept of tokens, accounts, wallets, transactions, and distributed ledgers. In essence, these approaches use a model of the way money is handled in bank accounts((
@@ Line 17: / Line 24: @@
 <figure>
-{{  cbdc:private:cbdc_omg:04_doc:40_currencies:hypecurve.png?700  |}}
+{{  cbdc:04_doc:40_currencies:hypecurve.png?600  |}}
-{{  cbdc:private:cbdc_omg:04_doc:40_currencies:hypecurve_detail.png?700  |}}
+{{  cbdc:04_doc:40_currencies:hypecurve_detail.png?600  |}}
 <caption>Gartner Group Hype Cycle </caption>
 </figure>
@@ Line 30: / Line 37: @@
 ==== Digital Account Theoretical User Scenario ====
-[[cbdc:private:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start| Return to Top]]
+[[cbdc:public:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start| Return to Top]]
-  : **Note:** The following Digital Account Theoretical User Scenario is only provided for discussion purposes. Actual User Scenarios would be developed during systems analysis and modeled using a Model-Based Systems Engineering (MBSE) approach and address the problem in far more detail with a team of experts.
+  : **Note:** The following Digital Account Theoretical User Scenario is only provided for discussion purposes. Actual User Scenarios would be developed during systems analysis and modeled using a Model-Based Systems Engineering (MBSE) approach and address the problem is far more detail with a team of experts.
 In the following example, the CBDC is modeled as a Digital account, each account representing an End User. The End Users would actually “own” a wallet that contains account information where money is recorded as a balance that can be added to or subtracted from. For example, a retail purchase would deduct the amount of the purchase from the customer End User's account and add it to the Store's account.
@@ Line 40: / Line 47: @@
 <figure transactionActFlow>
-{{  cbdc:private:cbdc_omg:04_doc:40_currencies:screen_shot_2022-03-11_at_5.14.25_pm.png?950  |}}
+{{  cbdc:04_doc:40_currencies:screen_shot_2022-03-11_at_5.14.25_pm.png?950  |}}
 <caption>Simplified Digital Account Flow</caption>
 </figure>
@@ Line 104: / Line 111: @@
 ===== Examples =====
-[[cbdc:private:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start| Return to Top]]
+[[cbdc:public:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start| Return to Top]]
-There are three categories of "desirements" alluded to in the [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:private:cbdc_omg:15_summary:start&do=edit | White Paper]] and identified within the [[https://www.omg.org/ | Object Management Group ]] [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:private:cbdc_omg:15_summary:start | White Paper Analysis]]:
+There are three categories of "desirements" alluded to in the [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:public:cbdc_omg:15_summary:start&do=edit | White Paper]] and identified within the [[https://www.omg.org/ | Object Management Group ]] [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:public:cbdc_omg:15_summary:start | White Paper Analysis]]:
   * **Digital Cash Model** - these are "desirements" with CBDC characteristics most closely aligned with the simple coin cash model
-  * **Digital Account Model** - these are "desirements" with CBDC characteristics most closely aligned with the [[cbdc:private:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start| Digital Account Model]] (i.e, savings, checking, investment, direct pay, credit, debit cards, etc. )
+  * **Digital Account Model** - these are "desirements" with CBDC characteristics most closely aligned with the [[cbdc:public:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start| Digital Account Model]] (i.e, savings, checking, investment, direct pay, credit, debit cards, etc. )
-  * **Research Areas** - these are "desirements" with CBDC characteristics most closely aligned with "research" models such as [[cbdc:private:cbdc_omg:04_doc:15_common:30_stablecoins:start| Stablecoins]]
+  * **Research Areas** - these are "desirements" with CBDC characteristics most closely aligned with "research" models such as [[cbdc:public:cbdc_omg:04_doc:15_common:30_stablecoins:start| Stablecoins]]
-In this discussion, only the "desirements" identified during the [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:private:cbdc_omg:15_summary:start | White Paper Analysis]] are considered. Table {{ref>AccountReqiurements}} represents the allocation of "desirements" germane to the Digital Account Model.
+In this discussion, only the "desirements" identified during the [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:public:cbdc_omg:15_summary:start | White Paper Analysis]] are considered. Table {{ref>AccountReqiurements}} represents the allocation of "desirements" germane to the Digital Account Model.
 <table AccountReqiurements>
 <caption>Example of mapping a subset of "desirements" identified during the White Paper Analysis conducted by the OMG</caption>
-^ Topic         ^ "desirements"  ^
+^ Topic         ^ Desirements  ^
 ^ Digital Account Model | <WRAP>
-  * B0005, B0010, B0022-4, B0038, B0047, B0048, B0049, B0051, B0054
+  : B: B0005, B0010, B0022-4, B0038, B0047, B0048, B0049, B0051, B0054
-  * P0002, P0012, P0013, P0017, P0018, P0019, P0020, P0021, P0023, P0024, P0025, P0017, P0028, P0030
+  : P: P0002, P0012, P0013, P0017, P0018, P0019, P0020, P0021, P0023, P0024, P0025, P0017, P0028, P0030
-  * R0002, R0009, R0012, R0015, R0020, R0023
+  : R: R0002, R0009, R0012, R0015, R0020, R0023
-  * D0001, D0002, D0003, D0005, D0008, D0010, D0012, D0013,
+  : D: D0001, D0002, D0003, D0005, D0008, D0010, D0012, D0013,
 </WRAP>|
+| **''B''** = [[cbdc:public:cbdc_omg:04_doc:12_summary:start#benefit_considerations| Benefit Considerations ]] |||
+| **''P''** = [[cbdc:public:cbdc_omg:04_doc:12_summary:start#policy_considerations| Policy Considerations]] |||
+| **''R''** = [[cbdc:public:cbdc_omg:04_doc:12_summary:start#risk_considerations| Risk Considerations ]] |||
+| **''D''** = [[cbdc:public:cbdc_omg:04_doc:12_summary:start#design_considerations | Design Considerations]] |||
 </table>
 ===== Discussion of Examples =====
-[[cbdc:private:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start| Return to Top]]
+[[cbdc:public:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start| Return to Top]]
-Table {{ref>accountReqComments}} provides a summary of using a [[cbdc:private:cbdc_omg:04_doc:15_common:08_currency_models:10_cash:start| Digital Account Model]] instead of a Digital Cash or Stablecoin Models. Many of the OMG identified "desirements" found in the [[https://www.federalreserve.gov/publications/files/money-and-payments-20220120.pdf | Money, and Payments: The U.S. Dollar in the Age of Digital Transformation]] **White Paper** during the [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:private:cbdc_omg:15_summary:start | White Paper Analysis]] appear to be appropriate for a CBDC **"Account Model"**. The **"Account Model"** uses Digital Money in an analogous model as Accounts for CBDC. For example, the "desirements" **''B0005''**, which is a requirement to //"Protect against criminal activity| In this context, criminal activity is either Money Laundering or Fraud. Fraud is an intentionally deceptive action designed to provide the perpetrator with an unlawful gain or to deny a right to a victim. Types of fraud include tax fraud, credit card fraud, wire fraud, securities fraud, and bankruptcy fraud. Fraudulent activity can be carried out by one individual, multiple individuals, or a business firm as a whole"//, is easily associated with **Accounts**.
+Table {{ref>accountReqComments}} provides a summary of using a [[cbdc:public:cbdc_omg:04_doc:15_common:08_currency_models:10_cash:start| Digital Account Model]] instead of a Digital Cash or Stablecoin Models. Many of the OMG identified "desirements" found in the [[https://www.federalreserve.gov/publications/files/money-and-payments-20220120.pdf | Money, and Payments: The U.S. Dollar in the Age of Digital Transformation]] **White Paper** during the [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:public:cbdc_omg:15_summary:start | White Paper Analysis]] appear to be appropriate for a CBDC **"Account Model"**. The **"Account Model"** uses Digital Money in an analogous model as Accounts for CBDC. For example, the "desirements" **''B0005''**, which is a requirement to //"Protect against criminal activity| In this context, criminal activity is either Money Laundering or Fraud. Fraud is an intentionally deceptive action designed to provide the perpetrator with an unlawful gain or to deny a right to a victim. Types of fraud include tax fraud, credit card fraud, wire fraud, securities fraud, and bankruptcy fraud. Fraudulent activity can be carried out by one individual, multiple individuals, or a business firm as a whole"//, is easily associated with **Accounts**.
 <table accountReqComments>
 <caption>List of "desirements" (i.e., desirements) identified in the **White Paper** indicating a **Account Model**.</caption>
+|< 100% 10% 25% ->|
 ^ Requirement ^ Statement  ^ Comment  ^
 ^ B0005 ^ Protect against criminal activity| In this context, criminal activity is either Money Laundering or Fraud. Fraud is an intentionally deceptive action designed to provide the perpetrator with an unlawful gain or to deny a right to a victim. Types of fraud include tax fraud, credit card fraud, wire fraud, securities fraud, and bankruptcy fraud. Fraudulent activity can be carried out by one individual, multiple individuals, or a business firm as a whole.  |
 ^ B0010 ^ Expand consumer access to the financial system | A financial system is the entire set of non-cash-based institutions (i.e., banks, thrifts, insurance companies, stock exchanges, etc.) permitting and facilitating the exchange of funds.  The expansion would entail adding people to these institutions |
 ^ B0022 ^ Provide a CBDC that is:<WRAP>
-  - NOT [[cbdc:private:cbdc_omg:8_append:20_glossary:privacy-protected| Privacy-Protected ]]
+  : 1. NOT [[cbdc:public:cbdc_omg:8_append:20_glossary:privacy-protected| Privacy-Protected ]]
-  - [[cbdc:private:cbdc_omg:8_append:20_glossary:intermediated| Intermediated]]
+  : 2. [[cbdc:public:cbdc_omg:8_append:20_glossary:intermediated| Intermediated]]
-  - NOT [[cbdc:private:cbdc_omg:8_append:20_glossary:transferable| Widely Transferable]]
+  : 3. NOT [[cbdc:public:cbdc_omg:8_append:20_glossary:transferable| Widely Transferable]]
-  - [[cbdc:private:cbdc_omg:8_append:20_glossary:identity-verified| Identity-Verified]]
+  : 4. [[cbdc:public:cbdc_omg:8_append:20_glossary:identity-verified| Identity-Verified]]
 </WRAP> | //Intermediated// generally implies accounts or digital wallets. //Identity-Verified// generally implies validating and verifying a person's identity to gain access to their accounts |
 ^ B0038 ^ Allow private-sector innovators to focus on: <WRAP>
-  - new access services
+  : 1. new access services
-  - distribution methods
+  : 2. distribution methods
-  - related service offerings
+  : 3. related service offerings
 </WRAP>| These innovations would predominately be account-based.  |
 ^ B0047 ^ Lower transaction costs | Normally, there are no transaction costs for using cash  |
@@ Line 152: / Line 166: @@
 ^ B0051 ^ Generate data about users’ financial transactions similar to the current Commercial Bank((
 Commercial banks include banks licensed either by federal or state banking agencies, credit unions, and thrifts from the **White Paper**.
-)) and [[cbdc:private:cbdc_omg:8_append:20_glossary:nonbank_money]] | This kind of data is collected on the activity in accounts.  |
+)) and [[cbdc:public:cbdc_omg:8_append:20_glossary:nonbank_money]] | This kind of data is collected on the activity in accounts.  |
-^ B0054 ^ Attract risk-averse users to CBDC | Risk Adverse investments usually pay little to no incentive to investors, but its value remains constant. Cash represents that kind of investment  |
+^ B0054 ^ Attract risk-averse users to CBDC | Risk Adverse investments usually pay little to no incentive to investors, but their value remains constant. Cash represents that kind of investment  |
 ^ P0002 ^ Provide Yield benefits more effectively than alternative methods | Cash generally offers no yield, therefore, this would require accounts  |
 ^ P0005 ^ Protect against criminal activity | See: **''B0005''** |
 ^ P0012 ^ The firms that operate interbank payment services are subject to federal supervision | These services typically use accounts to move payments unless it is referring to armored guards and vehicles  |
 ^ P0013 ^ Systemically important payment firms are subject to <WRAP>
-  - heightened supervision
+  : 1. heightened supervision
-  - regulation
+  : 2. regulation
 </WRAP>| Refers to the accounting practices used by the payment firms   |
 ^ P0017 ^ The PWG report recommends CBDC complement existing authorities regarding: <WRAP>
-  - market integrity
+  : 1. market integrity
-  - investor protection
+  : 2. investor protection
-  - illicit finance
+  : 3. illicit finance
 </WRAP>| Refers to the accounting practices for CBDC accounts |
 ^ P0018 ^ The Federal Reserve Act does not authorize direct Federal Reserve accounts for individuals | Refers to accounts  |
@@ Line 175: / Line 189: @@
 ^ P0027 ^ CBDC a risk-free asset | See: **''B0054''**  |
 ^ P0028 ^ Require significant international coordination to address issues such as:<WRAP>
-  - common standards
+  : 1. common standards
-  - infrastructure,
+  : 2. infrastructure,
-  - the types of intermediaries able to access any new infrastructure,
+  : 3. the types of intermediaries able to access any new infrastructure,
-  - legal frameworks
+  : 4. legal frameworks
-  - preventing illicit transactions
+  : 5. preventing illicit transactions
-  - the cost and timing of implementation
+  : 6. the cost and timing of implementation
 </WRAP>|   |
 ^ P0030 ^ The Federal Reserve will only take further steps toward developing a CBDC if: <WRAP>
-  - Research points to benefits for households, businesses, and the economy overall that exceed the downside risks
+  : 1. Research points to benefits for households, businesses, and the economy overall that exceed the downside risks
-  - Indicates that CBDC is superior to alternative methods
+  : 2. Indicates that CBDC is superior to alternative methods
 </WRAP>| See: **''B0054''** |
 ^ R0002 ^ **Risk** to the cost and availability of credit | See: **''B0054''**  |
 ^ R0009 ^ Increased **Risk** of "runs" or other instabilities to the financial system |   |
 ^ R0012 ^ **Risk** of increased concern related to the potential for: <WRAP>
-  - destabilizing "runs"
+  : 1. destabilizing "runs"
-  - disruptions in the payment system
+  : 2. disruptions in the payment system
-  - concentration of economic power
+  : 3. concentration of economic power
 </WRAP>| See: **''B0054''** |
 ^ R0013 ^ CBDC offers no associated credit or liquidity **Risk** | See: **''B0054''**  |
@@ Line 207: / Line 221: @@
 ^ D0012 ^ **Design** should address privacy concerns by leveraging existing tools already in use by intermediaries | These restrictions imply accounts  |
 ^ D0013 ^ **Design** should facilitate compliance with a robust set of rules already intended to combat <WRAP>
-  - money laundering
+  : 1. money laundering
-  - the financing of terrorism
+  : 2. the financing of terrorism
-  - customer due diligence
+  : 3. customer due diligence
-  - record-keeping
+  : 4. record-keeping
-  - reporting requirements
+  : 5. reporting requirements
 </WRAP>| These restrictions imply accounts |
 </table>
-===== Recommendations =====
-[[cbdc:private:cbdc_omg:04_doc:20_comments:brp:q02:start| Return to Top]]
-The [[https://www.omg.org/ | Object Management Group (OMG)]] is an unbiased, non-partisan, [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:s:sdo | Standards Developing Organization (SDO)]] and makes no recommendation at this time as to which [[cbdc:private:cbdc_omg:04_doc:15_common:08_currency_models:start | Currency Model]] to use:
-  * [[cbdc:private:cbdc_omg:04_doc:15_common:08_currency_models:10_cash:start     | 4.2.1 Digital Cash Model]] - Tokens
-  * [[cbdc:private:cbdc_omg:04_doc:15_common:08_currency_models:15_accounts:start | 4.2.2 Digital Account Model]] - Accounts
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