Digital Dollar is inevitable.
The US government has flirted with the idea in the recent stimulus bill and has now listed concrete plans to issue the Digital Dollar in 2021 with Federally approved digital wallets under the Automatic Boost to Community Act (ABC Act).
According to the proposals in the Act, the US government is expected to issue a Trillion dollar coins.
You did read that right. They plan to issue trillion dollar coins to fund the program that promises $2000 to Americans for a whole year.
What will this crazy printing of trillions of dollars lead to?
- Expect inflation in the coming years. US Economy is resilient and use of US Dollar as global reserve should keep its value intact for sometime, however, inflation will eventually catch up the dollar (unless a war, whether with countries or viruses, continue or ensue)
- Digital Dollar will be easily traced, tracked, tagged and taxed in real time
- Paper money may become extinct in the next decade
- Government will be able to learn spending habits (and illegal activities) and that data will be a huge gold mine to influence the behavior of Americans
- Most cryptos whose only value proposition is 'sending value over internet' (other than Bitcoin) will probably bite the dust with the introduction of Digital Dollar
- It will be a great stamp of approval for the legitimacy of the crypto space
- Utility tokens with exceptional use cases will gain some exemption under Securities act and may eventually come to represent 'share-like' units to trade
It is quite an scary and exciting time at the moment. We all are witnessing the future unfold right in front of our eyes. Strap your seat bets - bumpy roads ahead!
Everything in this article is an opinion.
