The US President Joe Biden promised to deliver a $1.9 trillion stimulus plan to revamp the country's economy that was hit hard by the Covid-19 pandemic.
Besides using their traditional US dollar (USD), the government was also planning to use other alternatives including central bank digital currency (CBDC) known as digital dollar. But will the situation change with the change of the President?
The effort was initially aimed at reducing the spread of the virus. Scientists discovered that banknotes posed a major risk of spreading coronavirus. Due to the fear of getting infected, the use of banknotes dropped sharply, something that turned out to be a blessing in disguise for digital payments including Bitcoin and other cryptocurrencies. Several shops and healthcare facilities worldwide have been encouraging their clients to use contactless payments, while others no longer accept any paper money or bank coins.
The USA has lost more than 518,363 people due to Covid-19. In the second quarter (Q2) of the Covid-19 plague, the US economy also managed to fall by more than 32.9% rate and the pandemic left millions of Americans unemployed. As per the report by the Commerce Department, the plague initiated the highest economic contraction in modern American history.
The House Budget Committee approved the relief payment plan. The stimulus package includes $1 trillion for families, with direct payments of about $1,400 to all US citizens. The relief plan also includes about $415 billion to combat coronavirus and around $440 billion for small and medium enterprises (SMEs). Biden is working hard to take the country's GDP back to pre-pandemic levels.
During the Trump administration, the house of representatives proposed two bills to allow the Federal Reserve System, the USA's central banking system, to adopt a digital dollar system as well as empowering personal income, especially in this pandemic time. The Federal Reserve is facing widespread disruption to payment services including a network that banking institutions and businesses use to store their money, and it is thinking of digital currency as a remedy.
Recently, Chairman Jerome Powell told Congress that the Fed is looking with a keen eye at issuing a digital dollar. This gives a clear signal that Joe Biden's presidency will influence the plans on launching CBDCs (digital dollars). Therefore, if the digital dollar is issued in time, it would be a big addition in the fight against the pandemic, solving snags in the payment services, and boosting the economy. It will help save the lives of a big populace in the country.