Running ahead of Libra, US Senators propose "New York Digital Currency" bill

Two New York State Senators and a professor from Cornell Law School are working on a proposal to create a digital payment platform for New York and introduce a state-specific digital currency.

According to data from the Federal Deposit Insurance Corporation (FDIC), more than 14 million adults in the United States did not have a bank account in 2017.

This includes various reasons, from personal choice to a range of prohibitive factors such as lack of identification, unemployment, inability to meet minimum deposit requirements, or inability to visit during bank hours.

In an attempt to address this issue, lawmakers in New York are working on a new bill that would create a public digital banking platform and cryptocurrency for use in the state, aiming to bring more people into the financial services system and stimulate local economic growth.

New York State Assemblyman Ron Kim, Senator Julia Salazar, and Cornell Law School Professor Robert Hockett are involved in the proposal for the "Inclusive Value Ledger (IVL)."

Robert Hockett joined Cornell Law School in 2004 and proposed the creation of a state payment platform and currency in New York to alleviate economic challenges for individuals and small businesses without bank accounts.

According to reports, the payment system and cryptocurrency would also provide financial assistance for long-term low-wage workers. Assemblyman Ron Kim stated:

I believe the proposal for the Inclusive Value Ledger could be revolutionary. By creating a free public savings and payment platform that all New Yorkers can use not only to buy goods and services but also to transfer money directly to each other, it can fundamentally reshape New York into a fairer, healthier, and more prosperous area, providing inclusive financial services for all.

According to the whitepaper, IVL aims to build a public management payment system similar to Venmo (a mobile payment service under PayPal) that allows New Yorkers to spend freely without transaction fees. Every business and individual in New York would have a virtual wallet connected to a master wallet controlled by the state government, serving as an alternative to bank accounts without associated fees from for-profit banks.

This concept is similar to Facebook's Libra project, which also envisions a viable alternative to fiat currency for millions of unbanked individuals. However, Libra is currently facing resistance from various governments, so this proposal may face similar challenges.

Further Reading

• South Korea's largest telecom company to issue digital currency in Busan
• Libra Association Vice Chairman: The world needs us, Bitcoin is not the panacea for payments

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