Rep. Stephen Lynch Introduces Bill to Create Treasury-Issued Digital Currency

Rep. Stephen Lynch, D-Mass., introduced a bill on March 28 that would create a Treasury-issued, hardware-secured digital currency, distinct from a central bank digital currency and capable of offline, peer-to-peer transactions without digital ledgers, blockchain, or accounts.

"As digital payment and currency technologies continue to rapidly expand and with Russia, China, and over 90 countries worldwide already researching and launching some form of Central Bank Digital Currency, it is absolutely critical for the U.S. to remain a world leader in the development and regulation of digital currency and other digital assets,” Lynch said in a press release. "The ECASH Act will greatly inform, compliment, and advance ongoing efforts undertaken by the Federal Reserve and President Biden to examine potential design and deployment options for a digital dollar."

The bill aims to create a digital currency that functions similarly to physical cash and would require the Treasury to incorporate key functionalities including privacy, anonymity, and minimal data generated from transactions. These measures seek to address the privacy concerns some legislators have raised about a potential Federal Reserve-issued CBDC, which the central bank is currently researching. Supporters of the bill hope this Treasury-issued digital currency would function in complementary fashion to a CBDC.

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