Central Bank of Bahamas to Roll Out Digital Currency by Next Year

The Central Bank of Bahamas (CBOB) is all set to enter into an official agreement for developing a digital currency system for fiat use on the 30th of May, 2019, according to reports from local news media outlets. The apex bank of the country is going to enter into an agreement with NZIA.io, a transaction provider, for the purpose of developing and then applying and implementing “Project Sand Dollar”.

This project will see the creation and adoption of the very first digital currency in the Bahamas, with full backing from the central bank of the country.

While this may be odd considering the notion of decentralization that usually underlies cryptocurrencies, the creation of government-backed fiat-based digital currencies represents a growing trend in modern economy and governance.

In the early part of March 2019, the Central Bank of Bahamas first announced NZIA as being its main partner for the digital currency project, in addition to Zynesis, a software development firm based out of Singapore. According to a statement from the Bahamian Central Bank, the “Project Sand Dollar” initiative will essentially be an “integrated, affordable electronic payment system for all businesses and residents.”

The project will be developed in a way that ensures thorough compliance with financial regulations put in place by Bahamian authorities.

The objective of the initiative will be to allow residents of the island transition to a system of greater digital payments. This is expected to reduce the frequency of cash transactions and cut the costs of service delivery in the country.

The Central Bank, which revealed its plans in this regard for the first time in June 2018, is yet to make an announcement about the islands that will be selected to run a pilot of the project.

However, reports suggest that bank governor John Rolle is keen to fully roll out the digital currency project for all the Family Islands by 2020.