Coinbase is funding a pilot that will deliver $12,000 worth of USDC to 160 low‑income New Yorkers. Managed by Givedirectly, the program will help recipients while studying how the cryptocurrency is spent and exchanged.
Coinbase Funds ‘Future First’ Universal Income Pilot In New York
The Facts
Coinbase will provide funding for a universal basic income (UBI) pilot that will benefit low-income citizens in New York, while also examining the impact of delivering these funds in cryptocurrency.
The pilot, named “Future First,” selected 160 New Yorkers to receive $12,000 worth of USDC, Circle’s signature stablecoin, with no strings attached, meaning that there will be no conditions for its spending.
The payments will be made in six installments over six months. The first one will be a lump sum of $8,000, and the remaining $4,000 will be divided into 5 payments of $800 each. Givedirectly, a nonprofit that has run this kind of program in other latitudes, including Kenya, Liberia, Rwanda, and Mozambique.
There are potential downsides to this focus, as Hilary Allen, a professor of law at American University’s Washington College of Law, told Bloomberg. The crypto delivery might entice citizens receiving this benefit to invest in cryptocurrencies, like bitcoin.
“I would say that giving money in this way is very much designed to make it easier to take that money to bet on Bitcoin. Because it’s going to be sitting as crypto in a crypto wallet with a crypto exchange,” she stressed.
Nonetheless, Givedirectly’s Emma Kelsey stated that one of the benefits of crypto is that it costs less than 30 cents to issue the first batch of $800 payments. At the end of the pilot, the platform will survey participants on their experiences, and whether crypto facilitated or was a barrier for managing these funds.
Why It Is Relevant
Coinbase’s experiment has a dual purpose. It aims to determine the effects of this free income on the participants’ lives and examine the relevance of delivering this help in cryptocurrency.
The issue of universal basic income (UBI) has become a relevant subject given the rise of artificial intelligence (AI), as experts expect some entry-level jobs to be taken by agents in the near future.
Read more: Will AI Make Universal Basic Income a Reality? Here’s How It Could Be Implemented
Looking Forward
If this pilot succeeds, it will help prove that crypto is an effective vehicle to deliver these funds to people who have not had contact with the technology yet, serving as a testament to the versatility and stability of blockchain.
FAQ
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What initiative is Coinbase funding in New York?
Coinbase is funding a universal basic income (UBI) pilot called “Future First,” aimed at providing low-income citizens with financial support in cryptocurrency. -
How much will participants receive and in what form?
The pilot will distribute $12,000 worth of USDC, Circle’s stablecoin, to 160 New Yorkers without any spending conditions. -
How will the payments be structured?
Payments will be made in six installments, starting with an $8,000 lump sum followed by five payments of $800 each over six months. -
What are potential concerns regarding cryptocurrency payments?
Experts worry that receiving funds in cryptocurrency may encourage participants to invest in volatile assets like bitcoin, impacting their financial management.
