Bahamas Central Bank Launches The First Public CBDC, The ‘Sand Dollar’ To Its Citizens
- The Bahamas is the first state to launch its central bank digital currency (CBDC).
- The ‘Sand Dollar’ is available nationwide, allowing users to spend the dollars on any merchant store.
The Bahamas central bank announced that the official central bank digital currency (CBDC), dubbed ‘Sand Dollars,’ is now available to all citizens nationwide. The announcement follows a nearly two-year wait since the pilot test project's announcement to 25,000 Bahamians across the islands of Exuma and Abaco in early 2019.
In a Facebook announcement from the Project Sand Dollar official page, the CBDC is available to nearly 400,000 Bahamians across the archipelago of islands. This allows the digital transfer of value and payment of transactions across any merchant in the country for a “negligible fee,” the announcement further stated.
The Sand dollars are digital tokens built on a secure cryptographic network with the minting and control maintained by the Bahamas Central Bank. The CBDC token will be integrated into the national payments network to facilitate domestic transactions.
Now, every Bahamas citizen can register for the CBDC token and start using it immediately “on their central bank-approved e-wallet downloadable on their mobile device.” This follows a small scale test of 48,000 Sand dollars distributed to citizens on the Exuma and Abaco islands in 2019.
According to the announcement, payment service provider NZIA Limited was selected as the technological solutions partner to “architect and implement the digital fiat currency system for the Bahamas.” In their statement, the project targets the unbanked and underbanked in society – aiming to push for CBDCs across the globe. The statement from NZIA reads,
“We believe strongly that Project Sand Dollar represents a meaningful step towards realizing financial inclusion, not only for the people of The Bahamas.”
“But one day for the billions around the world who do not have access to the financial system that some of us are fortunate enough to take for granted.”
Bahamas leads the world in distributing its CBDC to its citizens, but it is not the only state working on a sovereign digital currency.
Earlier this week, the Bank of Russia (BoR) announced its studying the pros and cons of launching its own CBDC; China already started pilot testing across major cities in the country, giving away $1.5 million in trials; Australia and New Zealand are both researching on the launch of a CBDC but have no plans to launch soon; and Japan’s central bank, Bank of Japan (BoJ), also announced plans to launch its CBDC in early 2021.