For example, a recent WSJ article describes a push towards a “national digital currency.” One of the quoted authors waxes eloquent about its virtues, but never really says what it is. But almost no one talks in those terms. When people use that recently-coined term, they usually means something brand-new, a form of cryptocurrency. The vast majority of people know through everyday experience that the US dollar is a national digital currency. The US dollar is indeed a national digital currency, with the added convenience of cards and cash. Cash is convenient for small transactions and for people who don’t have working, powered and connected small computers on their person. In addition, we have the added convenience of physical cash, 100% interchangeable with its digital currency equivalent, as we see with ATM’s every day. We also have cards, which are smaller, lighter and more convenient than smartphones, with the added convenience that they don’t crash or run out of power. The vast majority of currency value is fully and completely digital, and all large-dollar transactions are completely digital. What all this adds up to is that the US dollar is a national digital currency, by any reasonable definition, and has been for years. The early steps took place long before computers the principle was established and in universal use among banks and the federal reserve already in 1945! The invention and use of computers simply enabled further automation of the digitization of the US dollar, and enabled fully real-time transfers to take place. The process of transformation took place step by step, each leading to the next. There is no single date when you can say that the dollar became digital. By 1990, all money transfers between commercial and central banks were done electronically. In 1975, the government started depositing social security payments into recipient’s accounts electronically. In 1969 the large bills were officially discontinued, and the government started destroying them. Large inter-bank transfers were done without the exchange of cash tightly controlled procedures were used to transfer “money” between bank ledgers before the advent of computers. The last high-denomination bills were printed in 1945. 1928 Federal Reserve note National Museum of American History - Image by Godot13
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