Democrats consider 'digital dollar' in coronavirus bailout package

Daniel Fowler
March 27, 2020

The idea of a central-bank issued digital coin is not new - in many cases, national central banks want to create these assets in order to head off private sector efforts to introduce cryptocurrencies that could compete with fiat currencies.

The broad adoption of digital identity for new USA digital financial services is proposed in a bill tabled by the ranking Democrat on the House Financial Services Committee, aimed at stimulating the economy to mitigate the slowdown caused by the covid-19 pandemic. Although, none member banks can also apply to offer the pass-through digital dollar wallets.

Proposed legislation meant to support the USA economy during the coronavirus pandemic seemingly includes a recommendation to create "digital dollar" that could help the country get through the shutdown of business over the coronavirus outbreak. Pelosi said House Democrats will introduce their version of the stimulus package to respond to the coronavirus, offering an alternative to the bill now under discussion in the Senate. The bill would demand big federal reserve banks and other financial institutions to distribute digital wallets to provide economic stability to United States of America citizens and businesses in this time of need. Additionally, a digital dollar wallet is identified as a digital wallet or account, maintained by a Federal reserve bank on behalf of any person, that represents holdings in an electronic device or service that is used to store digital dollars that may be tied to a digital or physical identity.

The digital dollar wallets will be made available to all qualified individuals by the Fed who will also serve as an overseer for the digital dollar wallets. Member banks include those banks that are members of the Federal Reserve and regulated by the Fed.

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The U.S. currency's earlier rise was also fuelled by a turnaround in dollar positions among hedge funds to a net short from an overall long bet, according to latest positioning data.

In late NY trading, the euro was up to 1.0867 USA dollars from 1.0757 dollars in the previous session, and the British pound increased to 1.1870 dollars from 1.1748 US dollars in the previous session.

"Introduction of the digital dollar for sending economic stimulus payments".

The bill notes that such wallets would be branded as "FedAccounts".

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