Bahamas Central Bank to Test Launch Digital Currency

The Central Bank of the Bahamas (CBOB) is working on the development of a digital version of the Bahamian dollar.

Per the official announcement, the central bank will first launch the digital currency as a pilot in the Exuma district on December 27. The program will be extended to Abaco in the first half of next year.

Dubbed Project Sand Dollar, the regulator believes that the introduction of the digital currency will make access to the financial system more efficient and non-discriminatory.

“[The advantages of the digital currencies] include a potential suppression of economic costs associated with cash usage, and benefits to the Government from improved expenditure and tax administration systems,” the announcement stated.

The central bank is also confident that the digital form of the fiat will also help in tackling Money Laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Read this Term, terrorist financing, and other illicit abuses of the financial system.

It also emphasized the role of both banks and non-banking Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term services in the adoption of the new currency form.

“It is expected that the Government, as participant and user, would be a strong promoter of digital payments adoption, alongside non-bank payment services providers as the initial lead intermediaries in this space.”

2020 - the year of CBDC?

The CBOB is one of the many central banks in the world to explore the idea of introducing central bank-backed digital currency. As the Chinese central bank is set to bring its digital currency, its Russian counterpart also started to study the prospect of releasing its own cryptocoin. However, officials from the South Korean central bank made it clear that it has no plans to launch a CBDC.

“As the pilot progresses in Exuma, the Central Bank will simultaneously promote the development of new regulations for the digital currency, and strengthen consumer protection, especially around data protection standards,” CBOB stated.