Drone money is a concept describing a type of

digital currency Digital currency (digital money, electronic money or electronic currency) is any currency, money, or money-like asset that is primarily managed, stored or exchanged on digital computer systems, especially over the internet. Types of digital ...

enriched with

smart contracts A smart contract is a computer program or a transaction protocol that is intended to automatically execute, control or document events and actions according to the terms of a contract or an agreement. The objectives of smart contracts are the re ...

. It is a monetary tool that helps increase the effectiveness of a particular

monetary policy Monetary policy is the policy adopted by the monetary authority of a nation to control either the interest rate payable for very short-term borrowing (borrowing by banks from each other to meet their short-term needs) or the money supply, often ...

by providing a stronger and fairer transmission of such a policy. The currency is issued by a

central bank A central bank, reserve bank, or monetary authority is an institution that manages the currency and monetary policy of a country or monetary union, and oversees their commercial banking system. In contrast to a commercial bank, a centra ...

or a private issuer who does so to increase the purchasing power of individuals and households. Drone money takes the concept of

helicopter money Helicopter money is a proposed unconventional monetary policy, sometimes suggested as an alternative to quantitative easing (QE) when the economy is in a liquidity trap (when interest rates near zero and the economy remains in recession). Althou ...

(type of monetary stimulus that injects cash into an economy as if it was thrown out of a helicopter, i.e. unequal distribution; it is used to increase a nation's money supply through more spending, tax cuts, it boosts money supply) and combines it with the instrument of CBDC(central bank digital currency). Drone money utilises the method of even distribution and targets individuals to provide them with an equal sum of money through a dedicated account provided by a single organisation. Each individual is allowed to spend the money as they see fit, putting monetary policy back to the service of the citizens. “In the shorter term, drone money is the crypto version of helicopter money, using new technologies to issue helicopter money. Going beyond the failed transmission channels and distributing basic money directly to households, rather than through banks and financial markets.” For the first time, the “drone money” concept was implemented in

Kyjov Kyjov (; german: Gaya or Geyen) is a town in Hodonín District in the South Moravian Region of the Czech Republic. It has about 11,000 inhabitants. The historic town centre is well preserved and is protected by law as an urban monument zone. A ...

(

Czechia The Czech Republic, or simply Czechia, is a landlocked country in Central Europe. Historically known as Bohemia, it is bordered by Austria to the south, Germany to the west, Poland to the northeast, and Slovakia to the southeast. The Cz ...

) in the pilot project , created by and his compan
I, Foundation
was created as a response to

COVID-19 Coronavirus disease 2019 (COVID-19) is a contagious disease caused by a virus, the severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). The first known case was identified in Wuhan, China, in December 2019. The disease quickl ...

national lockdowns to help revive the local economy. The pilot utilised the concept of drone money and combined it with the monetary participation of the citizens. “I wanted to figure out how to take helicopter money and change it to drone money that will be targeted and effectively spent on boosting supply and demand,” said Rafaj.

References

{{reflist Digital currencies