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.
Bitcoin Holds Steady as a Store of Value as COVID-19 Wrecks Global Economic Havoc
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.
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