Following his exit from the CFTC, Giancarlo, who is affectionately referred to as the “Crypto Dad” has been pushing for the US government to pay attention to the global currency wars and consider creating a digital dollar to preserve the dollar hegemony.
Giancarlo registered the Digital Dollar Foundation earlier this year and has collaborated with multinational consulting firm Accenture to push for a private-public partnership with the Federal government to launch a digital dollar.
On Friday, the two organizations released a whitepaper which outlines how such as digital dollar would look like. As it turns out, it is not that much different from its would-be fiat counterpart. The digital dollar as Giancarlo envisions it is a digitized version of the current physical dollar with some aspects of its operation borrowed from the current crop of distributed ledgers.
In the 50-page whitepaper, the two organizations describe a two-tiered payment system controlled by the feds. The Federal Reserve would issue the currency to the commercial banks would then be in charge of distribution to the population. Well, there’s no surprise there given that this channel of distribution is exactly how physical cash gets distributed.
“Commercial banks (and potentially other regulated intermediaries with access to the Fed) would exchange reserves for digital dollars to be distributed to end-users much in the way they currently do when issuing physical cash to customers through ATMs,” the paper describes.
In terms of how much permission the system will have towards usage and deployment or how centralized or decentralized it will be, the paper was little light on details. Speaking to the media, Giancarlo said that the finer details are yet to be discussed and appropriately so since this discussion needs the involvement of the government as well as every other stakeholder. It is an invitation to the table to discuss how the proposed whitepaper can lead to the development of a digital dollar that works for everyone.
In the meantime, the Digital Dollar Foundation in collaboration with Accenture will under several pilot programs and tests to discover appropriate use cases for their proposed project. The whitepaper outlines several categories in which the proposed dollar will be tested including its use in domestic payments or cross-border settlements.
The digital dollar will also be tested in other uses such as government aids and peer to peer payments.