A groundbreaking guaranteed-income initiative supported by Coinbase is distributing $12,000 in cryptocurrency to selected young New York residents. The Future First program has chosen 160 participants aged 18-30 through a lottery system to receive payments in USDC stablecoin, with distributions already underway via Coinbase wallets according to Bloomberg reports.
Crypto Direct Assistance Program
Nonprofit organization GiveDirectly, known for managing cash-transfer programs globally, is overseeing this innovative pilot. Unlike conventional guaranteed-income projects that provide recurring payments over extended periods, Future First delivers one $8,000 lump sum followed by five $800 installments. This strategic approach aims to empower recipients for significant financial decisions like security deposits or educational expenses.
Coinbase provides the funding, having redirected $2.6 million from a previous discontinued initiative to support GiveDirectly's efforts. Darin Carter, Coinbase's Head of US Policy and Grassroots Advocacy, emphasized the program's dual purpose of offering "both financial assistance and cryptocurrency education for young New York residents."
Benefits and Challenges
Utilizing cryptocurrency instead of traditional cash presents distinct advantages and potential concerns. GiveDirectly highlights that USDC transfers cost mere pennies per transaction, significantly cheaper than prepaid cards or bank wire transfers. However, critics note potential risks including stablecoin depegging during market volatility and the temptation for young recipients to engage in speculative investments.
Participants can convert funds to traditional currency through bank transfers, utilize Coinbase debit cards, make ATM withdrawals, or maintain balances in crypto wallets to earn 4.1% annual interest and access additional digital assets. American University law professor Hilary Allen expressed concerns that these options might encourage risky financial behavior.
Program organizers will conduct post-participation surveys to evaluate whether cryptocurrency distribution created new economic opportunities or presented additional challenges. Current beneficiaries like 25-year-old Luis Acero express appreciation for the support, noting it provides "significant emotional and psychological relief."