The Central Bank of the Bahamas has announced to officially launch a central bank digital currency (CBDC) “Sand Dollar,” a state-backed virtual currency, is now available nationwide.
It has been reported that the CBDC became available to all 393,000 residents of The Bahamas from around 10:00 PM UTC, as this makes The Bahamas the first country in the world to officially roll out a CBDC.
However, China is currently testing a pilot program for its digital yuan with a $1.5 million giveaway, and Cambodia’s “Bakong” digital currency is expected to become operational in the coming months following its pilot launch in July 2019.
The report said that Sand Dollar transfers are made by mobile phone, with around 90% of the Bahamian population using mobile phones as of 2017.
More than two years after first announcing it was exploring a CBDC, the central bank of The Bahamas has launched the Sand Dollar https://t.co/YGDGrE2sfB — Cointelegraph (@Cointelegraph) October 21, 2020
According to the Sand Dollar website, residents of The Bahamas can use the digital currency at any merchant “with a Central Bank approved e-Wallet on their mobile device” and transaction fees are “negligible.”
The central bank selected transaction provider NZIA as its technology solutions provider for the rollout of the digital currency.
Likewise, the central bank of the Bahamas has been preparing for the launch of the CBDC for a few years. In 2019, it started a pilot program using 48,000 digital Sand Dollars on the islands of Exuma and Abaco, which have a combined population of fewer than 25,000 people. Each Sand Dollar is pegged to the Bahamian dollar, which is in turn pegged to the US dollar.
The Sand Dollar is intended to drive greater financial inclusion within the archipelago nation of more than 700 islands, about 30 of which are inhabited.
Thus, in September, Chaozhen Chen, the Assistant Manager of eSolutions at the Central Bank of The Bahamas, said that the CBDC would help provide “access to digital payment infrastructure or banking infrastructure” for underbanked and unbanked residents.