Notice2023-01534
Request for Information; Digital Assets Research and Development
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
January 26, 2023
Issuing agencies
Science and Technology Policy Office
Abstract
The Federal Government is developing a National Digital Assets Research and Development Agenda. The White House Office of Science and Technology Policy (OSTP)--on behalf of the Fast Track Action Committee (FTAC) on Digital Assets Research and Development of the Subcommittee on Networking and Information Technology Research and Development (NITRD) of the National Science and Technology Council, the National Science Foundation, and the NITRD National Coordination Office-- requests public comments to help identify priorities for research and development related to digital assets, including various underlying technologies such as blockchain, distributed ledgers, decentralized finance, smart contracts, and related issues such as cybersecurity and privacy (e.g., cryptographic foundations and quantum resistance), programmability, and sustainability as they relate to digital assets.
Full Text
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<title>Federal Register, Volume 88 Issue 17 (Thursday, January 26, 2023)</title>
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[Federal Register Volume 88, Number 17 (Thursday, January 26, 2023)]
[Notices]
[Pages 5043-5046]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-01534]
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OFFICE OF SCIENCE AND TECHNOLOGY POLICY
Request for Information; Digital Assets Research and Development
AGENCY: Office of Science and Technology Policy (OSTP).
ACTION: Notice of Request for Information (RFI).
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SUMMARY: The Federal Government is developing a National Digital Assets
Research and Development Agenda. The White House Office of Science and
Technology Policy (OSTP)--on behalf of the Fast Track Action Committee
(FTAC) on Digital Assets Research and Development of the Subcommittee
on Networking and Information Technology Research and Development
(NITRD) of the National Science and Technology Council, the National
Science Foundation, and the NITRD National Coordination Office--
requests public comments to help identify priorities for research and
development related to digital assets, including various underlying
technologies such as blockchain, distributed ledgers, decentralized
finance, smart contracts, and related issues such as cybersecurity and
privacy (e.g., cryptographic foundations and quantum resistance),
programmability, and sustainability as they relate to digital assets.
DATES: Interested individuals and organizations are invited to submit
comments on or before 5 p.m. ET on March 3, 2023.
ADDRESSES: Interested individuals and organizations should submit
comments electronically to <a href="/cdn-cgi/l/email-protection#c98d889b8de48f9d888ae49b8f8089a7a0bdbbade7aea6bf"><span class="__cf_email__" data-cfemail="93d7d2c1d7bed5c7d2d0bec1d5dad3fdfae7e1f7bdf4fce5">[email protected]</span></a> and include < RFI
Response: Digital Assets R&D Agenda > in the subject line of the email.
Due to time constraints, mailed paper submissions will not be accepted,
and electronic submissions received after the deadline cannot be
ensured to be incorporated or taken into consideration.
Instructions: Response to this RFI is voluntary. Each responding
entity (individual or organization) is requested to submit only one
response, in English.
Responses may address one or more topics, as desired, from the
enumerated list provided in this RFI, noting the corresponding number
of the topic(s) to which the response pertains. Submissions must not
exceed 10 pages (exclusive of cover page and references) in 11-point or
larger font. Responses should include the name of the person(s) or
organization(s) filing the comment, as well as the respondent type
(e.g., academic institution, advocacy group, professional society,
community-based organization, industry, member of the public,
government, other). Comments referencing materials that are not widely
published should include copies or electronic links of the referenced
materials. No business proprietary information, copyrighted
information, or personally identifiable information (aside from that
requested above) should be submitted in response to this RFI. Comments
submitted in response to this notice are subject to the Freedom of
Information Act. Comments submitted in response to this RFI may be
posted online or otherwise released publicly.
In accordance with Federal Acquisitions Regulations Systems
15.202(3), responses to this notice are not offers and cannot be
accepted by the Federal Government to form a binding contract.
Additionally, those submitting responses are solely responsible for all
expenses associated with response preparation.
[[Page 5044]]
FOR FURTHER INFORMATION CONTACT: For additional information, please
direct questions to Nik Marda, Anna Brady-Estevez, and James Joshi at
<a href="/cdn-cgi/l/email-protection#753134273158332134365827333c351b1c0107115b121a03"><span class="__cf_email__" data-cfemail="e7a3a6b5a3caa1b3a6a4cab5a1aea7898e939583c9808891">[email protected]</span></a> or 202-459-9688.
SUPPLEMENTARY INFORMATION: Responsible innovation in digital assets
could provide significant benefits for the American people. This RFI
seeks input to shape a whole-of-government effort on research and
development related to digital assets and distributed ledger
technology.
Terminology: As defined in Executive Order (E.O.) 14067, Ensuring
Responsible Development of Digital Assets and 87 FR 35250 (Request for
Information on Advancing Privacy-Enhancing Technologies), this RFI uses
the following definitions:
--Central bank digital currency: The term ``central bank digital
currency'' or ``CBDC'' refers to a form of digital money or monetary
value, denominated in the national unit of account, that is a direct
liability of the central bank.
--Cryptocurrencies: The term ``cryptocurrencies'' refers to a digital
asset, which may be a medium of exchange, for which generation or
ownership records are supported through a distributed ledger technology
(DLT) that relies on cryptography, such as a blockchain.
--Privacy-enhancing technologies: Privacy-enhancing technologies (PETs)
refer to a broad set of technologies that protect privacy, which are
within the scope for this RFI. We are particularly interested in
privacy-preserving data sharing and analytics technologies, which
describes the set of techniques and approaches that enable data sharing
and analysis among participating parties while maintaining
disassociability and confidentiality. Such technologies include, but
are not limited to, secure multiparty computation, homomorphic
encryption, zero-knowledge proofs, federated learning, secure enclaves,
differential privacy, and synthetic data generation tools.
--Digital assets: The term ``digital assets'' refers to all CBDCs,
regardless of the technology used, and to other representations of
value, financial assets and instruments, or claims that are used to
make payments or investments, or to transmit or exchange funds or the
equivalent thereof, that are issued or represented in digital form
through the use of DLT. For example, digital assets include
cryptocurrencies, stablecoins, and CBDCs. Regardless of the label used,
a digital asset may be, among other things, a security, a commodity, a
derivative, or other financial product. Digital assets may be exchanged
across digital asset trading platforms, including centralized and
decentralized finance platforms, or through peer-to-peer technologies.
For the purposes of this RFI, ``digital assets'' is also inclusive of
its underlying technologies (e.g., DLT).
Background: Digital assets are enabling new ways to move value
through the online world, and their underlying technology is
facilitating change across industries. In the private sector, companies
are using DLT to synchronize databases with limited trust, enable new
types of recordkeeping, build new infrastructures for managing digital
identity, and provide novel financial services to consumers. In the
public sector, the United States is exploring whether a CBDC could
provide a trustworthy infrastructure to facilitate transactions in a
highly digitized world. Across the board, applications of digital
assets are benefitting from advances in foundational and translational
research, spanning topics from cryptography to the social, behavioral,
and economic sciences. However, research and development (R&D) in this
space has often been conducted in a fragmented manner, with limited
consideration for the broader implications, applications, and downside
risks for the underlying innovations. This is particularly concerning
because there are many examples of how digital assets introduce risks
and exacerbate harms to people, communities, institutions, and the
planet.
A more comprehensive R&D approach would provide concrete areas of
focus towards achieving a holistic vision of a digital assets ecosystem
that embodies democratic values and other key priorities. This approach
would help ensure that sometimes-overlooked topics like
environmentally-friendly consensus mechanisms and fraud-resistant
transaction programmability receive appropriate levels of R&D support.
This approach would also help ensure that advances in digital assets
can also support technological progress in overlapping and adjacent
domains, including the traditional financial services industry.
Recognizing the importance of responsible innovation in digital
assets, President Biden signed E.O. 14067, which outlined the first
whole-of-government approach to digital assets. Pursuant to this E.O.,
OSTP published Technical Evaluation for a U.S. CBDC System, which
highlighted the importance of solving key open questions related to
digital assets. OSTP found that there were several important and open
questions related to digital assets R&D, which could benefit from
increased attention and support. These R&D questions span a wide range
of sociotechnical aspects, from technical innovations to social,
behavioral, and economic aspects, germane to advancing digital assets
while seeking to ensure that people from diverse groups, including
underrepresented and marginalized groups, can access and use digital
assets in a secure, privacy-preserving, inclusive, and equitable
manner.
This report recommended that the U.S. Government develop and
periodically update a National Digital Assets R&D Agenda. This
recommendation complemented the Multi-Agency R&D Priorities for the FY
2024 Budget, which requested that Federal departments and agencies
collaborate on critical and emerging technologies, including financial
technologies. To help implement this recommendation, OSTP and the
National Science Foundation are now co-chairing an interagency FTAC
under the NITRD Subcommittee to develop this R&D Agenda. Through this
whole-of-government effort, the Biden-Harris Administration will
identify R&D priorities for digital assets, and help direct Federal
resources and expertise toward advancing those priorities.
Digital assets have generated interest across a range of use cases
that could help grow the economy, provide societal benefits, and
advance equity and inclusion. There are a number of potential use cases
that support these goals, such as the potential for digital assets to
help human rights advocates receive financial support for their work
under governments that are trying to curtail their activities. However,
while much attention has been given to applications within the
financial ecosystem, there are also applications that span a range of
other sectors. For example, while some digital assets can consume a lot
of energy, their underlying technology may support easier integration
and coordination of clean energy resources, such as by providing a
better ledger for the authentication, participation, and renumeration
of beneficial services from distributed energy resources (e.g.,
electric vehicles, connected appliances and devices, residential and
commercial energy storage systems, solar power systems) on a smart
grid. There may be other applications of interest across other sectors,
such as healthcare and
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public health, supply chain management, manufacturing, and internet
architecture. The Federal Government should help ensure that the
potential of digital assets is realized in sectors where it provides
value, while taking steps to ensure that this realization is achieved
with the appropriate guardrails needed to ensure responsible innovation
in line with American values and a clear understanding and proactive
mitigation of the downside risks associated with increasing adoption to
digital assets.
A focused R&D effort could provide especially significant benefits
for better understanding and designing a particular type of digital
asset--the CBDC. While the United States has not made a decision about
whether it will pursue a CBDC in the next few years, a focused R&D
effort could help illustrate how to design a CBDC system in line with
the Biden-Harris Administration's Policy Objectives for a U.S. CBDC
System. For example, what cryptographic primitives and PETs could best
protect the privacy of individuals using the CBDC system? How can
social sciences and behavioral economics help identify and remove
barriers for usage of the CBDC system by underserved communities? What
security features are needed to ensure consumer trust and strong
resilience against criminal actors? A focused R&D agenda that engages
academia, industry, and civil society can advance policymakers'
understanding of how design choices for a CBDC system can impact
national policy objectives such as protecting privacy and advancing
equity. In turn, these findings could help support the Federal Reserve,
the White House, and the Department of the Treasury in assessing
whether the issuance of a U.S. CBDC is in the national interest.
Through this RFI, OSTP seeks responses that could inform the full
breadth of Federal R&D priorities related to digital assets, including
R&D initiatives that could complement the Federal Reserve's research
and experimentation related to CBDCs, consistent with the highest
urgency that E.O. 14067 placed on R&D for a U.S. CBDC system. We also
encourage respondents to explain how their R&D suggestions could help
advance policy priorities or recommendations outlined in reports
pursuant to E.O. 14067, such as OSTP's report titled Climate and Energy
Implications of Crypto-Assets in the United States.
Scope: OSTP invites input from any interested stakeholders. In
particular, OSTP is interested in input from parties researching,
developing, acquiring, using, or governing digital assets; and
stakeholders with relevant expertise, either learned or lived. This
scope extends to CBDCs, financial use cases, and any of the other use
cases and/or value propositions (across sectors) where digital assets
might add value or introduce risks of negative impacts.
Information Requested: Respondents may provide information for one
or more of the topics below, as desired. Through this RFI, OSTP seeks
information on specific R&D opportunities related to the following
topics:
1. Goals, sectors, or applications that could be improved with
digital assets and related technologies: Information about goals,
sectors, or applications where digital assets could provide significant
value to the public, and examples of where benefits are already being
delivered. This includes explanations of the current limitations in how
those goals, sectors, and applications are currently advanced with
limited use of digital assets and related technologies, and how
increased or better use of digital assets could provide a specific
advantage over existing approaches in advancing these objectives. Where
relevant, respondents are encouraged to justify how digital assets
provide unique value for advancing that goal, sector, or application
compared to the use of traditional databases or other technologies
(e.g., as outlined in National Institute of Standards and Technology
Internal Report 8202, Figure 6).
2. Goals, sectors, or applications where digital assets introduces
risks or harms: Information about goals, sectors, or applications where
digital assets might introduce risks or harms, and examples of where
risks or harms are already being manifested. This includes explanations
of direct or indirect impacts on users of digital assets, communities
or sectors in which digital assets might circulate or be integrated
into services, and non-users (e.g., communities, environment) that may
be exposed to risks or harms of digital assets (e.g., ransomware
attacks, higher electricity costs, pollution). Where relevant,
respondents are encouraged to justify how digital assets are
introducing new risks or harms in advancing the underlying goal,
sector, or application compared to the use of traditional databases or
other technologies.
3. Federal research opportunities that could be introduced or
modified to support efforts to mitigate risks from digital assets: This
might include information about R&D that helps companies build more
environmentally-sustainable digital assets, assist law enforcement in
countering illicit financial activity using digital assets, and enable
regulators to protect consumers from fraud. This includes opportunities
to innovate for equity and privacy with R&D that could help underserved
communities harness the benefits of digital assets while being
protected from their risks, such as via improvements to digital assets
to allow them to better remain accessible, reliable, and secure even
when connectivity and end-user device quality are limited.
4. R&D that should be prioritized for digital assets: Information
about Federal research opportunities that could be introduced or
modified to (a) advance the development of digital assets and/or (b)
protect communities and U.S. national interests from risks or harms
that digital assets might present. This includes topics for technical
research, topics for research in the social sciences and across
disciplinary boundaries, and opportunities for hardware and software
development. This also includes information about emerging areas that
could enable new opportunities to leverage digital assets, as well as
information about technical limitations of digital assets and the
associated business models and governance arrangements they often rely
upon. Respondents are encouraged to, where relevant, describe how the
discussed R&D topic could be useful in helping a potential U.S. CBDC
system align with the Policy Objectives for a U.S. CBDC System.
Respondents are also encouraged to share how the discussed R&D topic
could help advance U.S. competitiveness and leadership in the world.
5. Opportunities to advance responsible innovation in the broader
digital assets ecosystem: Information about opportunities for the
United States to advance responsible innovation in the broader digital
assets ecosystem, in areas that are adjacent to R&D. This may include
programs that could support increased education and workforce training
related to digital assets, standards setting efforts that could help
advance democratic values in the use and governance of digital assets,
and supply chain opportunities to maintain access to the necessary
hardware for emerging digital assets.
6. Other information that should inform the R&D Agenda: Information
about any other topic, not covered above, that respondents believe is
important to inform the development of the National Digital Assets R&D
Agenda. This may include ideas for collaborations between the Federal
[[Page 5046]]
Government and other entities, as well as proposals that may not yet be
feasible with the current state of technology but might become feasible
in the next decade.
Dated: January 22, 2023.
Rachel Wallace,
Deputy General Counsel.
[FR Doc. 2023-01534 Filed 1-25-23; 8:45 am]
BILLING CODE 3270-F1-P
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