The Bahamas has just launched a central bank digital currency (CBDC) for residents in the country.
The Bahamas has just become this way the first country in the world to roll out a digital currency at the state level. The price of the currency, dubbed Sand Dollar, is pegged to the Bahamian dollar, which is in turn linked to the US dollar.
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The CBDC can be used through smartphones, a device that around 90% of the population of the archipelago have access to. To operate with the currency, users must first install an electronic wallet approved by the central bank.
The financial institutions working with the Sand Dollar include one commercial bank, three payment service providers as well as four money transfer systems.
Per the project's website, the CBDC is accepted in all merchants and the transaction fees are "negligible."
The NZIA has been the technology solution provider selected by the regulator.
Even though the identity of the users of the currency does not remain anonymous, the project strictly follows the rules of privacy and data protection.
The regulator plans to launch new tokens as demand increases at the same time it withdraws cash dollars from circulation in order to maintain a balance in the market.
The Bahama's authorities reported on their plans to issue a digital currency back in June 2018. The tests of the CBDC began in December 2019.
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