160 Low-Income New Yorkers Receive $12,000 in USDC as Coinbase-Funded UBI Pilot Launches

A new privately funded Universal Basic Income (UBI) experiment is providing 160 low-income New Yorkers with $12,000 each in USD Coin (USDC), a stablecoin pegged to the U.S. dollar. The program, administered by the nonprofit GiveDirectly, is funded by a donation from cryptocurrency exchange Coinbase. Payments commenced in September, with a significant lump sum distributed in November, and are set to conclude in February.

The initiative stems from approximately $2.6 million allocated from Coinbase's now-defunct GiveCrypto philanthropy program. GiveDirectly is leveraging these funds to explore the efficacy of digital assets in social welfare programs and their potential to enhance financial stability for vulnerable populations. This marks a notable collaboration between a major crypto firm and a humanitarian organization.

Participants in the pilot receive their funds in a structured manner, beginning with an $8,000 lump sum in November, followed by five monthly payments of $800 in USDC. This payment model, which combines a large initial payment with recurring smaller amounts, was informed by research suggesting that lump sums can empower recipients to make larger investments, such as security deposits or educational programs. Emma Kelsey, program lead for the New York cash transfer pilot, noted that this approach could allow for investments with higher costs.

The program, dubbed "Future First," targets residents in low-income areas of New York City, specifically the South Bronx and East Harlem. GiveDirectly chose these locations due to significant need and existing political support for crypto accessibility in the region. The experiment aims to assess how recipients perceive and utilize crypto payments compared to traditional cash transfers, and whether stablecoins can offer a more efficient and transparent method for delivering aid.

Recipients have various options for managing their USDC, including holding it in a Coinbase account, transferring it to a traditional bank account, or spending it via a crypto debit card. As Kristy Tillman, a relevant figure, stated on social media, "Coinbase is giving some low income New Yorkers $12,000 in $USDC in a privately funded UBI experiment." The pilot seeks to understand if digital assets can serve as a viable and beneficial tool for future UBI programs, potentially reducing distribution costs and delays associated with traditional financial rails.