Like several other countries, The Bahamas’ digital currency pilot project went live in Exuma as residents are now allowed to enroll in the Central Bank of The Bahamas Project Sand Dollar.
The project which started December allows citizens to receive mobile wallets that the Bahamian government sees as facilitating the future of payments on the island chain. It is also categorized as a step toward the Bahamas’ goal of launching a digital currency.
Bahamas Central bank, however, said that the digital asset would help maintain financial sector stability and reduce transaction processing costs as well as reduce the risk of cash crimes.
According to bankers in the Bahamas, Sand Dollar is a digital fiat currency, not a cryptocurrency, stablecoin, or competitor to the Bahamian dollar. It is only a digital version equivalent to the paper currency,” they said in the project outline.
Like every other country, the project is another step toward the Bahamas’ long-term goal of launching a fully-fledged central bank digital currency (CBDC). The project would link domestic residents and businesses across a seamless digital payment infrastructure.
Residents would be able to pay for services through wallet-linked QR codes, with banks moving funds in digital form. The Central Bank believes this could ultimately cut currency printing costs and transaction fees while enhancing financial inclusion.
The central bank also mentioned that a widely adopted CBDC would place users at less risk of violent crimes.
The Bahamas’ retail-focused digital currency comes as more governments ready CBDC schemes of their own.
Sweden’s Riksbank is building its long-awaited “e-krona” in partnership with consultancy Accenture while China appears to be on the verge of launching a CBDC next year.