Jamaica’s Central Bank Begins Minting Country’s Digital Currency (CBDC)
Central Bank Digital Currencies (CBDCs) have become a hot topic in the last year, with Asian giant China leading the charge.
However, Caribbean nation Jamaica is now at the forefront following its roll-out of its first wholesale digital currency in a recently concluded ceremony.
BOJ To Issue $1.5 million CBDCs By December
The Bank Of Jamaica (BOJ) is planning to issue a total of 230 million Jamaican dollars (JMD), worth approximately $1.47 million in CBDCs, to deposit-taking institutions and authorized payment service providers. This, according to the announcement, is part of the digital currency pilot program ending this December.
The first batch of digital currency was minted to demonstrate the process of creating this digital version of fiat. This was done before the Minister of Finance and Public Service Nigel Clarke Jamaica, BOJ Governor Richard Byles, and the management team from blockchain firm eCurrency Mint.
Commenting on the ground-breaking achievement, Minister Clarke highlighted the pivotal role CBDCs play in the creation of a digital economy for the island country. The minister also promised that necessary legislative structures would be implemented to provide a legal basis for the Jamaican CBDC by the end of 2021.
Clarke has previously emphasized CBDC's influence in helping Jamaica transition into a digital society. He said it could greatly improve financial inclusion by making financial services available to the unbanked population.
BOJ Governor Richard Byles also believes that Jamaica's next CBDC adoption step would be to ensure widespread access and acceptance by bringing it closer to users.
Also speaking in the ceremony was eCurrency CEO, Jonathan Dharmapalan who commended the nation for its commitment towards creating a more inclusive financial landscape for its citizens. He also noted that Jamaica has the fastest-moving CBDC project in the world.
Jamaica's Rapid Progress In CBDC Project
Jamaica has been working on developing a CBDC since early 2020. The bank had originally planned to begin its pilot program in May but was delayed due to unstipulated reasons.
Last year, BOJ disclosed that it was researching CBDCs internally and introduced its new Fintech Regulatory Sandbox. The following month, the apex bank formally invited interested CBDC providers to develop and test potential CBDC solutions in this controlled environment.
The Jamaican Central bank then announced a partnership with eCurrency Mint in March 2021. The technology provider was chosen to support BOJ in testing its CBDC solution. eCurrency Mint was also revealed as the major provider when its national CBDC eventually roll-out begins in early 2022.
Other countries have also been picking up the pace of their CBDC research as no apex bank wants to be left behind when it comes to cross-border payments.
Countries like India already have plans to pilot their CBDCs soon. Last month, Reuters reported that the Reserve Bank of India (RBI) was considering a phased introduction of its CBDC. The Central Bank of Venezuela is also planning to launch a CBDC in October.