U.S. government indicates a stronger commitment to using digital currency infrastructure as the coronavirus crisis puts pressure on its economy. The new coronavirus stimulus bill includes plans for the creation of a digital dollar.
In response to the news, bitcoin price rose by 15% over a 24 hour trading period, touching $7,000. Other cryptocurrencies followed similarly positive price trends.
The over 1,000-page bill states that digital dollars would be stored in a digital wallet operated by the Federal Reserve Bank.
The bill defines digital dollar as “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”
Later on, “digital dollar” was stripped from the newer version of the “Take Responsibility for Workers and Families Act”
The bill could provide a lifeline for many Americans who are not able to afford approximately $400 emergency costs. There has been a notable increase in demand for debt as more Americans lose jobs in the wake of the coronavirus crisis.
Residents of the U.S. could receive $1,500. Although those who make over $75,000 would have to pay back the money, the assistance comes at a time when many businesses are on the brink of collapse as the coronavirus disrupts economic activity in the USA.
The recent events bring to light a bold comment made by billionaire investor Tim Draper who said that bitcoin (not banks or governments) will be the solution once the world bounces back from the coronavirus period.
Quantitative easing coupled with stress factors in the economy is likely to lead to a significant devaluation of the US dollar. As with Venezuela and other South American nations under intense economic pressure, more citizens of the USA could find themselves looking to bitcoin as a lifeline.
