In a pioneering move, the **Central Bank of The Bahamas** is considering enforcing a directive for all banks to integrate the nation’s central bank digital currency (CBDC), known as the **”Sand Dollar.”** Launched in 2020 as the first of its kind globally, the Sand Dollar is on the brink of a significant breakthrough.
With a bold two-year plan, the Bahamas’ financial authorities are pushing for a full-scale adoption of the CBDC by all commercial banks, as reported by Reuters. This initiative is aimed at encouraging the widespread use of the Sand Dollar among the banking institutions throughout the archipelago.
To facilitate this, banks are required to upgrade their technological infrastructure to accommodate the CBDC, a step deemed crucial by the central bank to enhance the Sand Dollar’s uptake and streamline mobile transactions.
Governor John Rolle of the Central Bank has indicated that compliance with these new regulations is no longer optional for financial institutions. “We’ve begun to signal that to our institutions,” he stated in an interview.
Despite the advancements, some industry stakeholders remain skeptical, citing a lack of clear benefits of the digital currency over traditional payment methods.
Governor Rolle, however, envisions that mandating the integration of Sand Dollar payments will be a boon for small-scale businesses, including eateries and local enterprises, enabling them to accept digital currency payments.
As of March, the Sand Dollar’s circulation was a modest $2.1 million, a figure representing under 1% of the total cash flow, as revealed by Shaqueno Porter from the Central Bank of Bahamas. The CBDC’s wallet users numbered 120,000—a significant count for a nation with a population slightly above 400,000. The multiplicity of proprietary wallets had led to consumer confusion, necessitating an educational push to clarify that the Sand Dollar operates uniformly across different wallets.
In a strategic move to broaden its appeal, the Bahamas has also made the Sand Dollar accessible to tourists. In the previous year, the country welcomed nearly six million visitors in just the first seven months. To simplify transactions for tourists, the nation has waived the Know Your Customer (KYC) requirements for minor Sand Dollar transactions.
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