Coinbase to will distribute $12,000 in USDC to 160 New York residents
A new universal basic income program with the participation of Coinbase will distribute USDC in a program for low-income residents of New York. The selected participants will receive $12,000 in stablecoins.
Coinbase and GiveDirectly will join forces for a new pilot testing a form of universal basic income. Selected New York residents will receive a no-strings-attached grant, with one condition- it would be paid out in USDC crypto tokens.
The program has picked 160 low-income residents of New York, who will receive $12,000 spread over five months. The grant will launch with a lump sum of $8,000 to encourage larger investments in housing or education. Recipients will then receive five more smaller deposits of $800, testing the hypothesis that a lump sum at the beginning of the grant can lead to better outcomes.
The new program arrives around two years after Coinbase abandoned its GiveCrypto program. The remaining $2.6M in the program was sent to GiveDirectly, to seed the New York program.
The Coinbase program does not limit the way of spending the USDC grant
Each participant will receive the tokens in a Coinbase wallet, with the ability to withdraw to a bank account, move to another wallet, or spend via a crypto card. The program will be administered by GiveDirectly, with the funds supplied by Coinbase.
There are no limitations on the way of spending the funds, though the UBI experiment will track the outcomes. The initiative is part of the UBI movement, testing its main thesis that no-strings-attached donations are a better tool for life improvement than targeted grants.
The funds were distributed via applications and a lottery to pick the final 160 participants. One of them, Luis Acero, has already lost thousands in crypto, reported Bloomberg.
The New York program, dubbed Future First, will explore the potential of stablecoins to be spent in a way that benefits the recipients. The program will track for improvements in housing situations or educational options.
Can crypto solve UBI?
Multiple crypto projects have attempted to build a form of UBI, including a token with the same ticker. Some have tried airdrops or referral-based distribution.
David Sachs denies the possibility that crypto can bring UBI, stating it’s a fantasy that will never happen.
Volatile crypto is also limited in its ability to support charity. The one possibility is the expansion of stablecoins, linked to the growing DeFi economy. The US Genius Act has set expectations for the creation of corporate stablecoins, offering a more controllable vehicle for UBI.
Crypto holds additional complexity and some limitations on wallet usage. USDC is a fully regulated and transparent token that behaves as close as possible to cash, though the holders may still need to pay transaction fees. The main fear for the Future Forward program is that the funds may be used for further risky bets on crypto.
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