The US Congress, and later the Senate, approved a $2 Trillion stimulus bill that will cushion American taxpayers as well as businesses, from the devastating effects of the Coronavirus.
The initial draft of the bill had explored the use of a Digital dollar to distribute funds to affected individuals. The bill had floated the idea of banks creating and maintaining digital dollar wallets for individuals and business entities. However, the concept of a digital dollar was left out in the final bill that was later approved by both houses.
Why the Idea of a Digital Dollar is Bullish for BitcoinThe mentioning of a digital dollar and provision of digital wallets by banks, ignited some excitement amongst crypto enthusiasts who found this move very bullish for Bitcoin (BTC) as shall be explained.
Secondly, the implementation of a digital dollar would open the doors for other countries who will not want to be left behind in digitizing their national currencies beyond internal CBDC (Central Bank Digital Currencies). With the global smartphone penetration estimated at 42% of the global population, roughly 3.2 Billion individuals will potentially have access to Bitcoin as a result.
Thirdly, once global currencies are digitized on the blockchain, other financial products such as securities, bonds and commodities will follow suit en masse. The probability of such tokenized assets being traded alongside Bitcoin is high. Therefore, such exposure would eventually legitimize BTC to many institutional and retail traders who had first considered it a fad or bubble
Tokenization of CommoditiesTo begin with, such a move would familiarize every American citizen with the concept of a digital wallet on their smartphone, desktop or web browser. It is a known fact that the whole concept of digital assets is complex for the average individual and this is the reason many do not venture into crypto. Therefore, having an incentive from the government of redeeming $1,200 via a digital wallet will surely help in familiarizing more potential investors with Bitcoin and Cryptocurrencies.
Tokenization of Commodities
Further exploring the tokenization of commodities, we have seen a few crypto exchanges such as Bitfinex and AAX.com, explore new ways of tokenizing precious metals and in particular, imilarly, AAX.com launched PhiGold (PGX): a token linked to an innovative mining venture. This token is not only pegged to the real price of gold, but it allows investors to get involved early before the actual precious metal is extracted from the ground. This aspect provides investors with an opportunity of funding the process of extraction at the PhiGold Barobo gold mine in the Philippines. Each PGX token represents 1/100th of an ounce of gold and can be redeemed for the physical metal, crypto or fiat after a certain period.
It seems to me that this crisis changes everything that we know. Firstly the fact that a lot of industries can work from home, then this. The fact that the US government takes this into consideration speaks for itself. If this lasts long enough we will see other aspects of our lives being remodeled
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