Investment Opportunities in CBDC Infrastructure and Fintech: Navigating the Fed's Digital Payments Evolution

The U.S. Federal Reserve's digital payments initiatives are reshaping the financial landscape, creating a fertile ground for investment in infrastructure and fintech firms. From the launch of FedNow to the exploratory research of Project Hamilton and global collaborations like Project mBridge, the Fed's efforts are driving innovation in real-time payments, cross-border settlements, and central bank digital currency (CBDC) design. For investors, these developments highlight actionable opportunities in companies positioned to benefit from the modernization of U.S. financial infrastructure.

FedNow: A Catalyst for Real-Time Payments Growth

The FedNow Service, launched in July 2023, has emerged as a cornerstone of the U.S. instant payments ecosystem. By July 2025, the platform had attracted over 1,400 participants, including banks, credit unions, and fintechs like FIS and Ibanera, which have integrated FedNow into their platforms to enable real-time transactions, according to a QuickMarketPitch report. FIS, for instance, now supports the full payments lifecycle via FedNow, including send capabilities and real-time alerts for credit transfers, as noted in an FIS press release. This growth is driven by use cases such as just-in-time payroll funding, real estate transactions, and automated federal agency disbursements through the Treasury's Digital Payout program.

The Federal Reserve's multi-rail strategy-encouraging coexistence with private-sector solutions like RTP-has further accelerated adoption. However, challenges remain, including slower-than-expected participation from major banks like Bank of America and Citigroup, as detailed in a FedNow two-year review. For investors, the key takeaway is the long-term potential of FedNow to become a universal payment rail, with fintechs playing a critical role in expanding its reach.

Project Hamilton: Pioneering CBDC Research

The Federal Reserve Bank of Boston and MIT's Digital Currency Initiative are at the forefront of CBDC research through Project Hamilton. This multi-year initiative has developed an open-source CBDC processing system, OpenCBDC, capable of handling over 1.7 million transactions per second with robust fault tolerance, according to the Project Hamilton executive summary. While the U.S. has not yet committed to a CBDC, the project's technical advancements-such as cryptographic proofs of payment and flexible authorization models-position it as a blueprint for future digital currency systems.

Investors should focus on firms involved in blockchain infrastructure and compliance tools, as these are critical for CBDC implementation. For example, Merkle Science and Chainalysis are already developing real-time transaction screening and AML/CFT solutions for CBDCs, with Merkle Science securing $30 million in 2025 to expand its offerings, according to the QuickMarketPitch report.

mBridge and Cross-Border Interoperability

The Project mBridge initiative, led by the BIS Innovation Hub and central banks from China, Thailand, the UAE, and Saudi Arabia, has reached the minimum viable product (MVP) stage in mid-2024, according to the Project mBridge page. Built on distributed ledger technology (DLT), the platform enables real-time cross-border settlements and has attracted participation from fintechs like Tencent. While the U.S. is not a direct participant, the project underscores the global demand for interoperable CBDC solutions.

Startups like Adhara and Ripple are capitalizing on this demand by offering enterprise blockchain solutions for cross-border payments. Adhara, which raised $20 million in 2025, is developing a wholesale CBDC interoperability platform, while Ripple's XRP Ledger continues to facilitate low-cost international transactions, as noted in the QuickMarketPitch report.

Regulatory Frameworks and Risk Management

The Federal Reserve's Novel Activities Supervision Program and the joint RFI with the FDIC and OCC highlight the importance of risk management in bank-fintech partnerships. These initiatives emphasize due diligence, contract negotiation, and ongoing monitoring, particularly for high-risk structures. For fintechs, compliance with AML and consumer protection laws remains a priority, as banks retain ultimate accountability for regulatory compliance.

Investors should prioritize firms with strong governance frameworks and expertise in regulatory compliance. Guardrails for Bank-Fintech Partnerships, a 2023 report by the American Bar Association, underscores the need for clear role definitions and risk mitigation strategies in these collaborations.

Market Projections and Investment Theses

The CBDC infrastructure market is projected to grow to $2–5 billion by 2026, driven by demand for wallet development, compliance tools, and cross-border interoperability solutions, according to the QuickMarketPitch report. Key sectors include:
- Wallet and SDK Development: Companies like Mobikwik and CRED are already deploying retail CBDC wallets in India.
- Compliance and Monitoring: Firms such as Merkle Science and Chainalysis are leading in real-time transaction screening.
- Cross-Border Interoperability: Adhara and Ripple are addressing the need for interconnected CBDC systems.

Despite the U.S. policy reversal under President Trump, global CBDC adoption continues to accelerate. Countries like China, Nigeria, and Switzerland are advancing their projects, while SWIFT's efforts to connect CBDC networks aim to reduce fragmentation.

Conclusion

The Federal Reserve's digital payments evolution presents a unique window for investors to capitalize on infrastructure and fintech firms poised to benefit from CBDC development. From FedNow's real-time payment ecosystem to Project Hamilton's technical innovations and mBridge's cross-border solutions, the opportunities span a broad spectrum. However, success will depend on navigating regulatory complexities and aligning with firms that prioritize scalability, security, and compliance.