After the US Senate Pros and Cons on Digital Money — What Do We Do With It?

Sunday 02 August 2020, 9:33 AM AEST - 5 months ago

The COVID-19 pandemic has certainly accelerated the digitalization of economies across the globe, opening up discussions on the future of digital financial services and whether our economy should advocate for the financial inclusion of Bitcoin (BTC) and other digital assets.

Yet, despite the horror we have been seeing as our industries continue to suffer, the digital payments industry is expected to thrive, based upon recently reported data from the Consumer Confidence Index. Reaching a three-month high last month, consumer confidence data revealed a 12.1 jump from 85.9 in May to 98.1 in June.

Last month when the United States Senate Committee on Banking, Housing, and Urban Affairs held its virtual meeting, dubbed The Digitization of Money and Payments, the conversation primarily revolved around stablecoins and whether our economy is ready for a U.S. central bank digital currency.

In case you missed it, it all came down to these two points, with committee chairman Senator Mike Crapo, a Republican from Idaho, explaining that our financial sector needs rules of the road, while Senator Sherrod Brown, a Democrat from Ohio, presented the question of: Why on earth we would trust big tech with our banking system?

The rules of the road

When it comes down to whether we need a digital dollar or not, I examined some of the discussion points throughout the hearing while diving into my continued belief that decentralized finance only emphasizes a need for a CBDC.

Digital dollar, for the uninitiated, is an electronic credit that would only exist on computers, but like a traditional, physical fiat dollar, consumers and businesses could use it to pay one another.

The opening statements of Junes hearing kicked off with Senator Crapo inviting witnesses to discuss why a CBDC is necessary now more than ever.

In short, he wanted answers to:

  1. Efforts being undertaken by different groups in the development of digital money and payments.
  2. Design, operational and risk ...

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