US Moves Towards Digital Dollar Payments After COVID-19 Bailout Fraud Hiccups

The COVID-19 pandemic has brought untold hardship to the US and the world at large. Countries are seeking ways to ease the burden of the period for its citizens. In response to the pandemic, the US government has rolled out about $2 trillion in bailouts for its citizens and companies.

The Congress Considerations

The US Congress has deliberated, severally, about the best way to achieve an efficient, transparent, and fraud-free distribution of resources among US citizens, and their discussions have tended towards creating digital wallets for beneficiaries with the digital dollar as a payment standard.

According to an article on The Guardian about fraud issues with the US COVID-19 bailouts, there's been an increasing lack of transparency from those in charge of distributing the bailout funds. It seems big organizations that need only a little support are benefitting from the relief funds more.

Small businesses and unbanked individuals seem not to be benefitting from the loans and other reliefs that the government and the American public are providing amid the pandemic. What’s worse is it’s difficult for watchdogs and the media to track how the funds flow from the authorities in charge to the qualified recipients of the COVID-19 bailout funds.

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A reliable solution that the US Congressmen have been pushing for is the digital dollar. When they first introduced their bill, it was rejected. However, the discussions around the 'digital dollar' have been reignited since the COVID-19 pandemic escalated into an economic crisis, with many affected people needing to be compensated.

 

Why the Digital Dollar Is Ideal for Curbing COVID-19 Bailout Frauds

According to an article published on Coindesk about CBDCs, the digital dollar may simplify the process of disbursing economic stimulus payments across the country. Much more in a way that boycotts opportunities for fraud.

Some of the features that make the US digital dollar a go-to system for transparent disbursements of the COVID-19 bailout funds are:

1. Digital Dollar Is Centralized

The Fed will run and manage the digital dollar, which will make it easier to trace and monitor the funds being allocated to qualified persons.

Although there are speculations that the the government may experience trust issues if left to manage Digital Dollar centrally, it is still an effective way of avoiding the prevalent fraud in the disbursement of the COVID-19 bailouts.

 

2. Digital Dollar Can Help the Unbanked Gain Quicker Access to Funds

A major challenge in the disbursement of the COVID-19 bailouts is the inequality in the distribution. Unbanked individuals, who need the resources more, may have to wait for months to receive a physical check.

Moreover, banks have the right to refrain from making payments to bank accounts with a negative balance.

The Digital Dollar can help overcome the process of going through third-party financial institutions since digital wallets can be created quickly, and "digital dollars" can be sent rapidly to the wallets.

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3. Digital Dollar Can Reduce the Chances of Spreading the Scourge

Although COVID-19 has not been proven to spread through paper money yet, some countries are taking measures to make spending paper money safer or completely alleviating the use of paper money. Digital Dollar is a way to prevent contact with paper money as much as possible.

 

In conclusion, while cryptocurrencies seemed like a far-off option in its early days, it has become the beautiful bride of late, offering more transparency and accountability.