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New bill launches extensive testing of digital dollars

2 US lawmakers have proposed a large-scale government-sponsored digital cash trial. The Electronic Currency and Safe Hardware (ECASH) Act, introduced by Congressman Stephen Lynch (D-MA), directs the Treasury Secretary to publicly test. “Electronic version” of US dollars. The bill remains unlikely to be passed, but it shows growing government interest in announcing alternatives to cryptocurrencies.

The ECASH Act requires the Secretary of the Treasury to establish a program called the Electronic Currency Innovation Program (ECIP). ECIP oversees a series of pilot programs of what the bill calls “e-cash.” It can be used without a private intermediary such as a bank or credit card company. The Treasury Secretary will begin piloting within 90 days of the bill’s passage and will roll out electronic cash to the public within four years.

The “digital dollar” is often confused with blockchain-based cryptocurrencies like Bitcoin, but the ECASH method seems to discourage the use of that technology. E-cash is considered to have “minimal transaction data generation properties”. Log transactions — and are supposed to allow peer-to-peer transfers that are not validated via a “common or distributed ledger”. The transfer also did not require additional verification by the central government system or payment processing company, but it does need to work with existing institutions such as banks. The idea is to mimic the high level of privacy, ease of use, lack of fees and processing hurdles of cash, but deduct physical charges.

At least three of the Lynch bills co-sponsored by Hess “Chui” Garcia (D-IL), Rashida Tribe (D-MI), Ayanna Pressley (D-MA) and Alma Adams (D-NC). I need one. An early proof-of-concept test performed within 180 days of passage. It may be implemented in partnership with a university or an existing financial institution and is designed to experiment with a variety of technologies. You need to be involved in at least one test. A physical card that can store cash and a card that requires you to store funds on your mobile phone or SIM card. Following these initial tests, there will be a limited public trial and “general deployment” within 48 months.

Lynch’s bill builds on widespread existing interest in the US “digital dollar.” The Federal Reserve released a preliminary report on digital currencies earlier this year, suggesting that it could benefit Americans who are not serviced by the current banking system. The administration has included the Central Bank Digital Currency (CBDC) as an action item for cryptocurrency enforcement orders. Many governments outside the United States were already considering digital currencies. Among other initiatives, the European Commission will propose the “Digital Euro” in 2023. China launched the “Digital Yuan” pilot program in January.

The bill specifies that e-cash, unlike the CBDC, does not support the potential Federal Reserve. CoinTelegraph Layout, no center Also A distributed ledger that tracks transactions. This maintains anonymity, but it also means that if the device or card holding it is lost, the user’s digital cash will be lost. It builds on existing Treasury cash exchange systems such as Eagle Cash, a digital money storage card. For members of the army.

The goal is to “complement and advance” other Biden administration programs while introducing a simple digital currency system into American mobile phones and wallets. “New digital tools need to emulate it, not replace it.”

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