Digital Dollar Proposal Makes Appearance in Stimulus Package

As the COVID-19 pandemic continues to spread and governments around the world seek out ways to reduce the physical impact of the disease, many are also focused on alleviating the economic breakdown that has followed in the wake of the pandemic as businesses are forced to shut down, causing mass layoffs or temporary unemployment.

Date: 
March 29, 2020
Read time: 
2 minutes

Digital Dollar Proposal Makes Appearance in Stimulus Package

Author: Dylan B
Date: 
March 29, 2020
Read time: 
2 minutes

As the COVID-19 pandemic continues to spread and governments around the world seek out ways to reduce the physical impact of the disease, many are also focused on alleviating the economic breakdown that has followed in the wake of the pandemic as businesses are forced to shut down, causing mass layoffs or temporary unemployment.

As the COVID-19 pandemic continues to spread and governments around the world seek out ways to reduce the physical impact of the disease, many are also focused on alleviating the economic breakdown that has followed in the wake of the pandemic as businesses are forced to shut down, causing mass layoffs or temporary unemployment.

While the digital dollar may not be the solution we are looking for, it is still exciting that the government has considered its use as a potential answer to our economic crisis, which just brings crypto one step further into the spotlight. 

Specifically, the U.S. is currently working on a stimulus package that would inject 2 trillion back into the economy, with individuals receiving $1,200 or more. Of course, the issue for the government during this time has not only been how much they should be giving out to individuals who have found themselves struggling financially but how they are going to disburse this amount to those across the country. 

Common answers have ranged from sending out checks to direct deposit, but the most interesting solution that has come up in proposals has been that of the digital dollar, which would be distributed to digital wallets of those who qualify for the payments. 

Previously found in Nancy Pelosi’s stimulus package proposal and still found in a proposal developed by Maxine Waters, the Chairwoman of the Financial Services Committee, the digital dollar would very much be a stablecoin, which would be released to the digital wallets of those who qualify and traded for physical dollars that the person can then use. 

In order to get the dollar to citizens, the proposals outline that banks regulated by and belonging to the Federal Reserve would create a pass-through wallet that would distribute these funds to those who qualify. Non-member banks would be able to participate by opting-in as well. 

Get More Knowledge: The Best Bitcoin Lending Sites

For those who aren’t able to access a digital dollar wallet, the U.S. Postal Service would lend a hand to those who are not with a bank or who do not have identification to set up an account as well as ATMs where they could access their funds. 

At the time of writing, the House still has to vote on the current stimulus package proposal and the creation and use of a digital dollar is more speculative than it is something to be considered as a quick means to get funds out to Americans. 

As Daniel Gorfine, founder of Gattaca Horizons, said in a statement to Forbes regarding the digital dollar: 

“It is worth exploring, testing, and piloting a true USD CBDC and broader digital infrastructure in order to improve our future capabilities and resiliency, but it is also important that this effort not delay the government from deploying critical emergency funds using existing channels during this crisis. While the crisis underscores the importance of upgrading our financial infrastructure, broadly implementing a CBDC will require time and thoughtful coordination between the government and private sector stakeholders.”

While the digital dollar may not be the solution we are looking for, it is still exciting that the government has considered its use as a potential answer to our economic crisis, which just brings crypto one step further into the spotlight. 

Posted by Dylan B

Dylan Buckley is a writer based in California. He became interested in cryptocurrency upon discovering it in 2014 and soon started investing as well as writing for a wide variety of clients and crypto-startups in the space. When he is not producing content for individuals and businesses, he is typically working on his own self-development content or making music.

Comments

Add new comment

CLAP

Share

text