Victor Ugochukwu · Dec 14, 2020 . 5min read
Bahamas Plans to Launch its Digital Currency Sand Dollar in October
The Central Bank of the Bahamas is moving ahead with the launch of its digital currency Sand Dollar in October after its pilot in 2018.
By Komal Joshi · Sep 17, 2020 . 5min read
The Central Bank of Bahamas intends to launch its central bank digital currency (CBDC), the Sand Dollar, in October. The Bahamas will be striving to be the first country in the world to possess a state-backed e-currency. The Central bank of Bahamas has also concluded plans to launch a central bank-issued cryptocurrency from as early as next month. The Bahamas intends to promote financial inclusion and access via its digital currency.
Intricate Details on Minting Sand Dollar
If a bank or payment provider wants to add Sand Dollars to their wallet, they demand it from the Central Bank, which coins the Sand Dollars and attaches it to its wallet. The payment for the digital currency is in fiat currency. These institutions are the gateways for individuals and businesses to top up their wallets. To start a Sand Dollar wallet users do not require a bank account. However, they also do not need a phone as there’s an alternative to a card-based wallet comparable to a prepaid credit card.
Inadequate Banking Services in the Bahamas led to the Launch of CBDC’s
The Central Bank of the Bahamas declared its ambition to pilot a CBDC in June 2018. This move came after various banks nearby the smaller islands moved their operational network, with most affected communities. Additionally, multiple banks drew out from the communities due to their downsizing. Thus, leaving the communities with inadequate banking services. Nevertheless, this enlightened the necessity for an alternative method for citizens in such communities to access financial services. Therefore, this promoted the development of Bahamas’ CBDC.
A Sand Dollar is pegged to the Bahamian dollar, which pegs back to the U.S. dollar. The government launched the Project Sand Dollar pilot last year, testing its CBDC on the small islands of Exuma and Abaco. Through its pilots in Exuma, the central bank had issued $48,000 worth of the Sand Dollar, valued 1:1 with the regular Bahamian dollar.
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