It's closer to each individual bank having their own digital currency, all of which are worth 1 USD each. The digital US dollars at my bank are not directly exchangable with the digital US dollars at your bank. You need to settle up with an ACH transaction, which takes at least a day to transact as it has to run in a central batch job. In addition, only US domestic institutions can use this mechanism to transfer US dollars between themselves -- international institutions need to use the SWIFT system, which is multiple days for a transaction. Contrast with credit card payment and settlement, which acts closer to a digital system but can't be used as a store of value (and has punitive fees for attempting to do so). The US dollar acts like a cash system with some digital features rather than a digital system.
> The digital US dollars at my bank are not directly exchangable with the digital US dollars at your bank. You need to settle up with an ACH transaction, which takes at least a day to transact as it has to run in a central batch job.
FedNow will reduce that latency from days to minutes. US is slow in that game, but RTP is widely deployed in UK, France, etc.
For international transactions, one can use SWIFT (days) or TransferWise (minutes) or Western Union (under one hour).
I want my digital cash to work like regular cash. I need to pay the lawn guy, send an iMessage. I wanna buy lunch, swipe my phone and pay with the money in my phone. I don't need the charge going through my bank or some intermediary.
I want freedom to use my digital money the way I want without someone holding my account hostage, if I do something wrong. Additionally, I have no problem losing my money, if I send the money to the wrong person or lose my phone.
That's good usability-wise, but it still has the problem of central banks being able to create money (diluting your wealth for their benefit) and also being able to cancel you, or someone you want to pay, out of the system. It's a horribly powerful way to control people.
FedNow is a digital cash system. It's not there yet, and it's still not international. As for Western Union et al, it's a bit like claiming the US has a digital cash system because Venmo exists -- it's someone else taking on the risk the funds won't settle in order to provide a better user experience. So the US is approaching a digital cash system, but it's not there.
