The Bahamas Reveal Details, October Date of Landmark Central Bank Digital Currency Debut
The Bahamas confirmed it will cross the central bank digital currency (CBDC) finish line next month.
- In a late Friday tweet, the Central Bank of the Bahamas announced that on Oct. 20 it will begin the “gradual national release” of its consumer-facing “Sand Dollar” digital currency, perhaps the world’s first retail CBDC.
- Though it was already known that the Bahamas was eyeing a mid-October release, the Friday announcement sets a hard date for the historic event and sheds new light on the rollout.
- In the first phase, private sector players such as banks and credit unions will ready their systems with “know-your-customer” and other compliance checks across low-value, personal, and enterprise wallets.
- Sand Dollar’s second phase, slated for early- through mid-2021, will focus on preparing essential infrastructure services in the government and private sectors, such as utility companies, for the CBDC.
- A growing cadre of financial and payment institutions slated to intersect with Sand Dollar have already invested in building out mobile wallets for their users and have been on-boarded for the rollout accordingly, the central bank said.
- Those wallets will be secured with “multi-factor authentication” safeguards, according to the announcement.
- Users cannot and should not expect to have cash-like anonymity when using the CBDC, the central bank said. Even so, it said Friday that wallets will be encrypted “to ensure confidentiality.”
- Additionally, the central bank said it has prepped the CBDC by subjecting it to a “rigorous cybersecurity assessment” to overcome public fears of paying with a digitally native currency.
- Regulations surrounding the Sand Dollar CBDC are still in the works. The central bank said those “will be crystalized in the public space over the month of October.”
“The intended outcome of Project Sand Dollar is that all residents in The Bahamas would have use of a central bank digital currency, on a modernized technology platform, with an experience and convenience—legally and otherwise—that resembles cash,” the central bank said.
