US Reps Lynch and Pressley tout ECASH bill for those excluded from digital transactions at BU event

The United States needs e-money to help those excluded from the digital economy even as the world goes cashless. And BU’s Faculty of Computing and Data Science (CDS) has some ideas on how to do this safely, securely and privately.

U.S. Representative Ayanna Pressley (D-Mass.) and U.S. Representative Stephen Lynch (D-Mass.) visited the law school on Tuesday to discuss HR 7231, the Electronic Currency and Secure Hardware (ECASH) Act, which would develop an electronic version of the US dollar for use by the American public.

Lynch introduced the bill after noting that the rapid global trend towards cashless transactions could leave behind “a huge swath of the population,” especially the unbanked or underbanked, who are already unable to access financial services that many take for granted, as well as those in areas without reliable internet service.

We need a system “that can be used by people at the bottom of the economic ladder,” Lynch said. “We hope this bill will address many of the challenges we face as we move towards a cashless society.”

The ECASH Act would establish an electronic version of the US dollar for use by the American public that would retain many features of physical currency, including anonymity, privacy, peer-to-peer transactions, and interoperability with existing financial systems. ECASH would be distributed to the public via secure hardware devices and would be regulated in the same way as physical dollars; it would be subject to existing laws in areas such as money laundering and transaction reporting.

Pressley said the danger is that as our society becomes cashless, it will leave behind people for whom cash transactions, check cashing services and payday lenders are more common than credit cards. debit or online banking. She noted that 10% of Boston households are unbanked, another 20% are underbanked, with limited or no access to ATMs and credit cards, lines of credit, etc. And these issues tend to fall along racial lines.

“There are still many cash-dependent communities, who need money to buy groceries, money to pay their bills,” Pressley said. “As lawmakers, it’s our duty to find solutions that promote financial inclusion while safeguarding privacy and consumer protection, because if we don’t, we’re failing our most vulnerable communities. “

Pressley is one of Lynch’s four original Bill co-sponsors; both are members of the House Financial Services Committee, where the bill is being discussed.

Lynch, chair of the committee’s fintech working group, also points out that ECASH needs to be done right. While reviewing early versions of central bank e-currencies created in the Bahamas, Singapore, and China, among others, he realized that maintaining privacy, anonymity, and security would not be easy. “In China,” he noted, “every transaction is subject to full-spectrum monitoring.” And cryptocurrency and blockchain have hardly been free of problems.

He noted that when the government distributed COVID relief funds under the CARES Act, 75% of uncovered fraud came from online platforms — “a red flag.”

BU’s contribution comes in the form of ideas on implementation from three CDS members and another data scientist soon to join the faculty.

Allison McDonald, an assistant professor at CDS working in security, privacy, and human-computer interaction, spoke about the importance of including the target community in the design process. IT workers are still predominantly white, male and “not low-income,” she said.

“The harm happens when technologists don’t think about how people use technology in the real world,” McDonald said. “One way to avoid these issues is to ensure those most affected have a seat at the table throughout the process, not just as a check at the other end.”

Gabe Kaptchuk is an Assistant Research Professor of Computer Science in the College of Arts and Sciences and Research Development Fellow at BU’s Hariri Institute for Computing and Computational Science & Engineering. He explained how easy it is for large datasets to get “sucked up by surveillance systems” and the ways that have been discovered to prevent this. He pointed to a process called secure multiparty computing, which enables transactions without either party revealing proprietary data.

Mayank Varia is CDS Associate Professor of Computing and Data Science and Director of the Hub for Civic Tech, the CDS initiative at the intersection of technology and the public interest. He discussed the importance of technology and the law working hand in hand.

And Eran Tromer outlined a series of steps Congress can take to help technologists create an ECASH that will work, including resolving ambiguities in laws and policies. Tromer, a computer scientist whose resume includes stints at Columbia University and Tel Aviv University, is expected to begin faculty appointments at CAS in Computer Science and the Questrom School of Business early this year. next.

The audience of more than 60 at LAW’s Barristers Hall included university president Robert A. Brown and law school dean Angela Onwuachi-Willig and law professor Ryan Roth Gallo and Ernest J. Gallo, who both spoke briefly, and Azer Bestavros, associate provost for computing and data science and a professor emeritus William Fairfield Warren, who moderated.

The Faculty of Computing and Data Science sponsored the event with BU Federal Relations.