🛠️ Digital USD – Implementation Notes

This document provides implementation-level guidance for building the Digital USD infrastructure as described in the System Overview. It focuses on protocol-level design, system modifications, and transitional integration with current financial infrastructure.

I. 🎯 Project Scope

  • Replace ACH and Fedwire with a high-performance distributed ledger
  • Use a native token (USD) backed by Federal Reserve issuance
  • Preserve compatibility with Treasury cash operations and existing bank infrastructure
  • Enable future support for competing currencies

II. 🔧 Forking Heiro ledger services and Replacing HBAR

1. Clone & Customize Heiro Services Node

2. Remove/Stub HBAR Logic

  • Eliminate hbarBalance fields from account structures
  • Refactor fee calculation logic to default to TokenID(USD)
  • Strip staking, IORB yield, and system reward logic tied to HBAR
  • Replace all fee payment and transaction execution costs with USD-only accounting

3. Bootstrap Native USD Token

  • Create TokenID(0.0.1001) at genesis block
  • Hardcode as system-reserved “base currency”
  • Treasury wallet (e.g. 0.0.2) receives initial mint
  • USD token enforces:
    • No user mint/burn
    • Transferability restricted by attestation

III. 🔐 Wallets and Attestations

1. Wallet Creation Flow

  • User creates keypair via app
  • Submits KYC to approved attestation provider (e.g. Socure, Alloy)
  • Attestation is signed and stored on-chain or as verifiable credential

2. Attestation Schema 

{
  "wallet": "0xABC...", // wallet identifier
  "attestor_id": "attestor:us:001", // any string identifier supplied by US treasury
  "attestation_id": "4f3e8c51-d3c7-44f4-b77a-0123efabfa9a", // can be any string identifier
  "jurisdiction": "US", // All jurisdictional country codes in attestations follow **ISO 3166-1 alpha-2** (2-letter format)
  "timestamp": "2025-07-08T12:15:00Z" // standard ISO date format in GMT
}

VI. 🏦 Banking Integration & Cutover

1. Core Banking Providers

  • Fiserv, Jack Henry, Finastra, etc. integrate SDK
  • see (SDK Specification)[/sdk-specification]

2. Treasury Conversion Flow

  • Banks create wallets, Federal reserve sends bank wallets digital USD upon surrendering physical reserve balances via Fedwire or Fed account adjustment

See (monetary policy)[/monetary-policy] for more info

VII. 📈 Performance and Scalability

1. Expected Load

  • U.S. daily settlement volume ~300M transactions
  • Target: 3,000–5,000 sustained TPS (with room for growth)

2. Heiro Ledger Token Service Benchmarks

  • Transfers: >10,000 TPS
  • Token mints: ~1,000 TPS (not frequent)

3. Optimization Plan

  • Strip unused Heiro ledger services (e.g., Consensus Service)
  • Streamline ledger state for multi-token flat structure
  • Future: validator parallelization, state sharding

VIII. 🛡️ Protocol Governance

1. Node Operators

  • Operated by a trusted consortium (e.g., Federal Reserve Primary Dealers as an initial set)
  • Fixed set of validators with quorum-based governance (e.g., 13 of 21 signatures required)
  • Validators confirm transactions, verify attestations, and enforce protocol logic

2. Protocol Roles

Role Description
Wallet Holders Includes banks, businesses, individuals — hold and transact in USD
Token Authorities Entities with permission to mint, burn, and stake tokens (e.g., the Federal Reserve for USD)
Attestors Approved identity providers who issue KYC attestations used for compliance
U.S. Treasury Supplies attestator allowlist and denylist data; prints physical QR cash
Validators Trusted nodes that run the protocol, enforce transaction rules, compliance, and attestations

3. Software Update Process

  • Proposed by validators or protocol developers
  • Requires multi-signature approval from quorum of node operators
  • Scheduled into an upgrade window
  • Rolled out across nodes during synchronized protocol update

IX. 📌 Deployment Plan (Phased)

Phase 1 – Testnet

  • Internal testnet with Treasury + SDK
  • Simulate USD issuance, QR cash
  • Staking enabled

Phase 2 – Pilot Network

  • Onboard banks to testnet
  • Mirror real ACH and Fedwire activity

Phase 3 – Production Cutover (MVP)

  • Treasury publishes genesis ledger snapshot
  • Middleware redirects to SDK
  • Paper USD surrendered for QR cash
  • ACH & Fedwire turned off

Phase 4 – Competing Currencies (Post-MVP)

  • Token registry opened
  • Currency swaps enabled
  • Corporate/state tokens permitted

X. 🧠 Final Notes

  • MVP is single-token only (USD)
  • The goal is neutral infrastructure: programmable, auditable, and permissioned, but open to competition
  • This platform is the new foundation of direct settlement. Once live, everything else is software.