Could Digital Currencies Help Avoid Spread of COVID-19?
Unless you have been living under a rock, then you know that the world has been under a viral pandemic attack, COVID-19, since 31st December 2019. At the time of writing of this article, there were 182,864 confirmed cases globally and 7,174 deaths.
COVID-19 has already had significant adverse effects on a global scale. Besides the health concerns that it poses, the world is also facing a global economic challenge, following the downward spiraling of the stock and crypto markets everywhere.
As the pandemic continues spreading, the concern is quickly rising on how to curb the spread of the deadly virus. There has been talk about how digital currencies could help reduce the spread of COVID-19. But how accurate are these claims?
In this article, we will delve into finding an answer to the above question and have a brief look at the coronavirus and its relation to digital currencies today.
WHO’s Thoughts on Banknotes Spreading COVID-19
On 2nd March, The Telegraph UK published an article citing the WHO on claims that dirty banknotes may be aiding the spread of the virus. The widely cited article further states that the organization encouraged alternative payment methods to help curb the spread of the disease.
A few days later, however, a spokesperson for the World Health Organization came out to clarify the comments in the article. According to Fadela Chaib, WHO spokeswoman, the organization was misinterpreted, and they did not say that cash was spreading the virus. She also added that the organization had not issued any warnings to that effect.
Fadela clarifies that the magazine had sought WHO’s opinion on banknotes and the spread of COVID-19. WHO answered that cash users should wash their hands after handling money, especially if they are eating. It is, after all, excellent hygiene.
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Countries Measures to Stop Spread of COVID-19 Through Cash
Although WHO clarified their remarks on the spread of the virus through banknotes, governments are not taking chances. It is a well-known fact that paper money is filthy and an ideal carrier for several bacteria.
Even before the claims on WHO remarks about cash, China had already taken steps to curb the spread of the virus. In February of this year, the Chinese government held a press conference, in which it ordered all the banks to sterilize cash before issuing it to the public. The government ordered the banks to use either ultraviolet or heat treatment to disinfect the notes and to withdraw potentially infected notes from circulation.
Further measures were put in place to collect the notes from high-risk areas such as hospitals, sterilize them, and later hold them in PBoC, instead of recirculating the notes.
Muhammad Munir, who is a virologist at Lancaster University, England, however, argued that the move might not help much, seeing as many of the transactions in the country are already cashless.
China is not the only country that has taken measures against banknotes. According to this Reuters post, the US did not take any chances either. The Federal Reserve began quarantining the dollars the country repatriates from Asia, before re-issuing the notes to the US. The article, which dates back to earlier this month, mentions that the shipment from Asia would be isolated for seven to ten days, before circulating the money to various financial institutions.
The Confederation of All Indian Traders (CAIT) urged that the country needs to look into the spread of the virus through banknotes. CAIT added that other countries such as the UK and Canada were now using polymer notes instead and that India should look for ways to incorporate that as well.
Other countries taking measures against cash include Korea, which is using high-heat laundering to get rid of the virus on banknotes before recirculating the notes in the country.
Are Digital Currencies the Answer?
According to the American Center for Disease Control and Prevention, the coronaviruses can stay on hard surfaces for a while. However, a person can only get infected if the virus comes into contact with their mouth and nose. In this regard, the best way to handle the spread of the virus is not by adopting cashless transactions, but by washing hands thoroughly as advised.
That said, there’s no doubt that the traditional payment system exposes a significant number of people to the risk of contracting the disease. So, therefore, do digital currencies hold the answers we seek?
Digital currencies could come in handy at this time. Rather than have to use notes or cards, you can pay for your services using your digital money. These currencies help reduce human interaction and thus help stop the spread of the virus.
One of the most popular digital currencies is CBDCs, which many countries across the globe are trying to adopt. CBDCs are digital currencies that are backed by the central government of a nation. These digital currencies behave similarly to cryptocurrencies, except that they are issued and regulated by the central bank. The presence of a central authority throws away the entire concept of decentralization.
In the wake of the Corona outbreak, governments should perhaps consider developing their CBDCs much earlier than they anticipated. These currencies will reduce not only human interaction but also offer several other benefits to countries’ health-care systems. These currencies help maintain a more stable payment system that is transparent, making it easier to rack any completed medical transactions.
As the world keeps trying to battle the spread of this deadly virus, it is upon every person to take the initiative to stop the spread. Although the adoption of digital currencies could help reduce human interaction, governments and their citizens need to take more preventive measures to curb the spread of the disease.
However, we must remain vigilant on the use of banknotes and coins and be aware of how they could possibly spread the virus faster than we anticipated.
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