A Draft of the COVID-19 Bill by US Congress Proposes the Issuance of Digital Dollar
The Democrats in the US house of representatives are proposing the implementation of a digital dollar to facilitate payments, outside of the traditional financial system.
According to a proposed draft stimulus bill by House Democrats, which has been circulating ahead of formal publishing, there is a provision that would create a digital dollar, should the bill be passed. The draft also proposes the creation of digital wallets for US citizens, which would be maintained by the Federal Reserve Bank.
There is a session in the bill entitled “Direct Stimulus Payments for Families”, which envisions $2,000 monthly payments to every adult who earns less than $75,000 per year. The payments, according to the bill, would continue until the economy recovers. The proposal would require member banks of the Federal Reserve to make digital dollar wallets available to all US citizens.
The draft bill also appears to incorporate some elements of a proposal from Michigan Congresswoman, Rashida Tlaib, known as the Automatic BOOST to Communities Act. The proposal calls for eventual creation of a permanent Treasury administered digital public currency wallet system.
The digital dollars would exist in pass-through digital wallet or account, maintained by the Federal Reserve Banks on behalf of the citizens. It 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 proposal noted that member banks with total consolidated assets in excess of $10 billion shall promptly offer individuals the ability to apply for the pass-through digital wallets. The citizens can do so through online or telephonic means.
According to the bill, such wallets will not be subject to accounts or balance-related charges. The member banks would also be required to provide equal functionality and service levels to what they offer for their existing transaction accounts.
Through these wallets, the Federal Reserve member banks would be reimbursed each calendar quarter, for operational costs incurred. They will have the remit to permit State banks and credit unions provide similar pass-through digital dollar wallet services.
Featured image courtesy of Shutterstock. Source: Cryptopress.