United States of America is now facing a possible meltdown on its economy due to the huge impact of the Novel Coronavirus or COVID-19 in the country. US Congress already proposed a bill called “Coronavirus Stimulus” which will put a temporary lifeline to the economy before it totally reaches the meltdown. And one part of this suggestion bill is the creation of a “digital dollar.” What is it?
What is a “digital dollar”?
According to the proposed bill of US Congresswoman Nancy Pelosi, a Coronavirus Stimulus is what the federal country needs for now. A stimulus package is a coordinated effort to increase government spending and lower taxes and interest rates in order to stimulate an economy out of a recession or depression.
In order for the US economy to survive the virus spread, the House of Representatives proposes to use its national fund to support the need for employment until the market bounces again in the future. However, this news does not just affect Americans but even the crypto market.
According to a report in BTCManager, there seemed to be an interesting word that was written on Pelosi’s proposed bill, which is called the “digital dollar.” This term was used on the bill, saying that stimulus payments should be distributed through digital currencies to avoid people going on banks and other financial entities.
Are we going to expect crypto-based stimulus packages?
Though the proposal directly states ‘digital dollar’ on the draft bill, it is not what you think it is. As explained, this is not a unit of cryptocurrency, but it involves the usage of a digital ledger.
“[It] is a balance expressed as a dollar value consisting of digital ledger entries that are recorded as liabilities in the accounts of any Federal Reserve bank; or an electronic unit of value, redeemable by an eligible financial institution (as determined by the Board of Governors of the Federal Reserve System),” written on the draft bill.
US government, once approved the bill, will also create digital dollar accounts and online wallets in order to accommodate the needs of every American now stuck at their homes to quarantine.
Binance US CEO Catherine Coley once suggested this kind of digital dollar system to the government.
“The government needs to look for ways to innovate the antiquated process of distributing checks by mail. In the interests of speed and safety, why not consider sending the stimulus in the form of stablecoins as a means to verify the transfer of assets?” she said.
For now, it seemed like they’re following the advice.