The Bahamas have just deployed their central bank digital currency (CBDC), the „Sand Dollar“. Its launch comes after a pilot program initiated in October 2019.
The Sand Dollar lands in the Bahamas
The Central Bank of the Bahamas (CBOB) today officially introduced its own central bank digital currency (CBDC), the “ Sand Dollar ”. This makes the Bahamas one of the first countries in the world to launch a CBDC beyond a pilot program .
The information was shared during a webinar broadcast on Facebook , on the dedicated Sand Dollar page. As of today, the 386,000 inhabitants of the archipelago can create their digital wallet on their smartphone and carry out transactions.
The entire Sand Dollar ecosystem will therefore transit through smartphones, and all Bahamian merchants can very easily accept it as a means of payment.
The central bank has chosen the company NZIA as its technological partner for the deployment of the Sand Dollar. Also based in Canada, South Korea, Singapore and South Africa, NZIA specializes in developing solutions compatible with existing regulatory frameworks and financial frameworks.
On the official Sand Dollar website , here’s how the Central Bank of the Bahamas justifies the introduction of this CBDC:
„The goal is to promote more inclusive access to regulated payments and other financial services for underserved communities and socio-economic groups, as well as reduce service delivery costs and increase transaction efficiency for financial services. across the Bahamas. „
Each Sand Dollar is backed by a Bahamian dollar, which in turn is pegged to a US dollar. In addition, the CBOB claims that the fees required to complete a transaction are negligible, without giving further details.
A CBDC quickly set up
This CBDC had been in the works for several years, although things really accelerated last year when it was publicly announced.
The Sand Dollar project had been the subject of a pilot program since October 2019 , when 48,000 units were in circulation on the islands of Exuma and Abaco, combining a population of 25,000 people.
Although the Sand Dollar is being rolled out nationwide fairly quickly, the project already looks quite mature . The Central Bank of the Bahamas ensures that its entire ecosystem is already operational.
The institution hopes in particular that at the end of this project, all inhabitants of the Bahamas will have equal and expanded access to modernized digital means of payment . At the same time, a reduction in cash transactions is also planned, a feature that will certainly be debated.
This new payment infrastructure is expected to reduce service delivery costs, increase transaction efficiency and improve the general level of financial inclusion of communities throughout the archipelago.
Along with Venezuela’s Petro (PRT) , the Sand Dollar is one of the first sovereign digital currencies to emerge . Although the challenge is less compared to the deployment of the digital yuan in China , the Bahamas are proving to the whole world their lead on a technology which is still very young.