The Central Bank of the Bahamas has announced it is working on the development of a digital version of the Bahamian dollar.
The Central Bank of the Bahamas plans to release a pilot version of the digital currency in the Exuma district. Abaco will join in the initiative shortly.
The new digital currency is pegged to the Bahamian Dollar, and named the “Project Sand Dollar”.
Besides, the central bank reveals the project serves as a continuation of the Bahamian Payments System Modernization Initiative (PSMI). It began to function in the early 2000s.
The CBOB sees great potential in the digital currency
The regulatory institution believes that the introduction of the digital currency enhances improved outcomes for financial inclusion and access. As well as making their domestic payments system more efficient and non-discriminatory when it comes to accessing financial services.
Accordingly, the central bank states that other advantages of the currency include a potential suppression of economic costs associated with cash usage. It also benefits the government through reduced expenditure and improved tax administration systems.
Besides, the CBOB claims that the digital form of the fiat helps tackle money laundering. As well as, terrorist financing and other illicit abuses of the financial system. The central bank also emphasized the role of both banks and non-banking payments services in the adoption of the new currency form.
The official announcement also said: “It’s expected that the Government, as participant and user, stands as a strong promoter of digital payments adoption.”
Plans concerning the currency
The Central Bank of the Bahamas also revealed what’s next on the agenda. Thus, it will promote the development of new regulations for the digital currency. And strengthen consumer protection, majorly around data protection standards.
Besides, the bank plans to advance reforms to permit the direct participation of non-banks in the domestic payments system.
“Early passage of the new Central Bank of The Bahamas Bill will support the creation of some regulations. While additional reforms will be possible under the existing Payment Systems Act,” the announcement revealed.