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National Digital Currency Could Expedite Stimulus Checks, Unlock Other Possibilities

Elijah Labby

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Screenshot of Garrick Hileman, head of research at Blockchain, from the webinar

May 21, 2020 — Although there are risks, national digital currency can have significant benefits, said participants in a Center for Data Innovation webinar on Thursday.

Although many Americans have received their $1200 stimulus checks from April’s CARES Act, those who do not have a bank account or are married to non-citizens have not.

The “Take Responsibility for Workers and Families Act” and the “Financial Protections and Assistance for America’s Consumers, States, Businesses, and Vulnerable Populations Act,” both introduced in late March, would allow the Federal Reserve to create digital currency and hasten the process of delivering stimulus checks to Americans.

However, critics worry that such a development would give the federal government too much power. The U.S. Constitution prohibits state governments from issuing currency; if implemented, the digital currency would be at the federal level.

When asked if officials should consider amending this, Daniel Gorfine, founder of Gattaca Horizons LLC, said it would be unwise.

“I do not think that states or cities or municipalities should be in the business of trying to essentially tokenize or mint tokenized currencies competitive with the U.S. dollar,” he said.

Nonetheless, Gorfine said that states would play a crucial role in the implementation of such currency. “If you’re trying to pilot the benefits of tokenization, you could imagine the tokenizing of things like unemployment benefits,” he said.

Other participants argued that digital currency was a necessity in a world where China and other countries are preparing their own digitized monies.

“It’s about getting ready for a future where you have a lot of tokenized assets,” Policy 4.0 CEO Tanvi Ratna said. “You have a lot of tokenized contracts, you have machine-to-machine communication, you have borderless communication, and if you don’t have a currency that can deal with that sort of an environment then it doesn’t matter.”

“It’s not about money,” she continued. “It’s about what you’re unlocking for the future.”

A recording of the webinar can be viewed here.

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