Tunisia Central Bank Testing Digital Dinar in Collaboration with Russian Blockchain Platform
The Central Bank of Tunisia is digitizing the Tunisian dinar and has announced the launch of the E-dinar, reported Russia’s local news agency, Tass, which it says will be the first central bank digital currency.
The virtual money will be issued by Universa Blockchain, a blockchain platform providing end-to-end digitalization services.
Back in December 2018, the Tunisian government joined hands with the Russian blockchain platform.
Electronic Money is Not Cryptocurrency
While Russia’s parliament, the State Duma will be deciding on a crypto bill on “Digital Financial Assets” in the autumn session, the Central Bank head, Elvira Nabiullina has been against private digital currencies.
“We are for financial technologies to develop. But we do not support private money in any form, digitally or not. If they replace public money, they will destroy monetary policy and financial stability. We are against,”
But electronic money is not cryptocurrency says Alexander Borodich, founder and CEO of Universa.
“Electronic banknotes cannot be faked – each such banknote, like the paper version, is protected by cryptography, it, like the paper counterpart, has its own digital watermarks. And the production of such a banknote is 100 times cheaper than wasting ink, paper, electricity for the printing press,”
E-dinar, the newspaper stated would be backed by the country’s paper money, as such individuals will be able to make the switch. Universa will launch a web application and open two thousand stalls in Tunisia for individuals to transfer their money to E-dinars.
An Attempt to Regulate the Economy
Borodich believes Tunisia will be able to work with other countries of Southeast Asia (Malaysia and the Philippines) and Latin America (Argentina and Brazil) on the project.
Countries like Morocco, Algeria, and Mauritania can also join the project in the future under one system to conduct international payments with electronic money at an agreed rate. Currently, they are just part of the E-dinar presentation.
The digital dinar has been in the works for about a year now which is Tunisia’s attempt to renew trade regulations and regulate its domestic economy.
According to the report, the developers will give all the encryption keys to the Central Bank of the country. The Russian company will receive a percentage of each operation for the duration the technology is used.
A transaction between Marouane El Abassi, head of the Central Bank of Tunisia and a representative of the International Monetary Fund has been already tested out. The currency will remain in its testing phase for several months before it can be used in stores and restaurants at large.