On Saturday March 21st, Congresswoman Rashida Tlaib called on the U.S treasury to create platinum coins to support the Coronavirus recovery. The Congresswoman believes this will be a strategical approach to quickly give everyone in America cash payments for their struggles. The idea gets even more interesting as the infrastructure could involve "digital public currency" in the form of eCash.
Automatic BOOST To Communities Act
The universal relief program was announced by the Congresswoman on Twitter. According to the tweet, the plan calls for:
- Direct preloaded $2,000 cash cards to everyone
- The cards would "recharge" - meaning $1,000/month would be extended until a year after the economy recovers
Distributing The Capital
In order to generate the funds, the congresswoman proposed that the Treasury Secretary would work with the "U.S Mint" to essentially issue 2 separate $1 trillion dollar platinum coins. From there, Congress would then have the Federal Reserve purchase both of these minted coins at their "face value." The Federal Reserves balance sheet would stay fully capitalized since they would now have ownership over the $2 trillion dollars in platinum coins. After the funds hit the Treasuries general account, it would then be funneled through the appropriate channels to get every person in America "pre-paid debit cards."
eCASH / Digital Currency Infrastructure
It appears that the Congresswoman understands the potential risks of the proposal above. Despite the platinum coins being a mechanism to free up "digital cash," it truly lacks the infrastructure of a true digital currency. With the proposal planning to issue physical debit cards, this opens up opportunity for fraud and misplacement. Aside from delivering the cards in the mail, the proposal offers other ways to collect the cards such as physical pickup. Even with the different pickup methods, it sill opens up the door for all sorts of inefficiencies.
It seems like they understand this as the proposal also talked about the future of the digital cash. According to the release, the proposal talked about the long-term infrastructure which include:
- Digital public currency wallets ( eCASH )
- Universal Fed Accounts For All
Various parties right now are rushing to market with Coronavirus relief plans. With this being said, it's safe to say that the eCASH / digital accounts approach above would not be the original way this package is rolled out. There's slim to no chance this protocol has been in the making, especially the whole idea of digital public currency wallets. The approach above does sound very similar to "bank backed digital currencies" which have surfaced lately. Despite platinum coins being a whole different approach, the thought process behind it remains relatively the same. The ultimate goal is to free up funds that can be backed by the government and issued to the public in the most efficient matter. It's quite interesting that Congress officials are dipping their feet in eCASH and digital currency wallets. Even if this idea makes it nowhere, it's important to see what government officials are looking at on the backend. As time progresses, it's evident that some sort of digital currency protocol will be implemented by governments / banks to innovate our payments systems.
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