US e-cash: Bill proposes digital currency that replicates cash, bypasses the Fed

cointelegraph.com:

The Electronic Currency and Secure Hardware Act (ECASH Act), introduced today in the United States House of Representatives, could herald a new direction in government-sponsored digital currencies.

The legislation calls for the U.S. Secretary of the Treasury to develop and pilot an electronic version of the U.S. dollar that is easy to use for the economically marginalized or technically challenged. It would also “maximize” consumer protection and data privacy, according to its principal sponsor Representative Stephen Lynch, chair of the Fintech Task Force in the House Financial Services Committee.

Interestingly, e-cash, as it’s called, would be issued by the U.S. Treasury Department, not the Federal Reserve Board, which means it would technically not be a central bank digital currency (CBDC) nor would it be built on a blockchain or require the internet to operate. It is designed to “replicate the privacy-respecting features of physical cash,” such as coins and notes to the greatest extent possible.

The initiative isn’t meant to necessarily preclude a Fed-issued CBDC, however. The pilot program launched by the ECASH Act will “complement, and advance ongoing efforts undertaken by the Federal Reserve and President Biden to examine potential design and deployment options for a digital dollar,” said Lynch, a democratic representative from Massachusetts, in a statement. Representatives Chuy Garcia, Ayanna Pressley and Rashida Tlaib are co-sponsors of the bill. 

The bill envisions the launch of a two-phase e-cash pilot program within 90 days of enactment — with the deployment of e-cash to the American public expected no later than 48 months after enactment. 

The legislation is being proposed and supported by a coalition of