There is no widespread usage of The Central Bank of The Bahamas’ (CBOB) Sand Dollar digital currency yet, as all stakeholders have chiefly focused on ensuring the technology behind the currency is stable and robust, CBOB Governor John Rolle said yesterday, adding that campaigns to encourage the use of the world’s first central bank digital currency (CBDC) is currently underway.
Rolle, who made the remarks during an appearance on the International Monetary Fund’s (IMF) interview series “The Exchange” alongside IMF Managing Director Kristalina Georgieva, explained that the development of the technology platforms have been completed and the push to get Bahamians trading the currency is now the focus.
“We are not seeing high use yet because there has been a lot more focus at this point on product development. And because we are in the background allowing the financial institutions to be the ones to make use of the instruments, their big work has been on developing their technology platforms, making sure that their platforms tie in and are interoperable with the Sand Dollar platform,” Rolle said.
“That work is completed now. What you will see is that the Central Bank will be making a deliberate push around encouraging adoption in use and that is a campaign that we are literally starting as I speak.”
CNN’s Julia Chatterley, host of The Exchange, revealed poll numbers that show a little more than a quarter of respondents believe digital currencies would hurt and not help the unbanked and underbanked. Georgieva said the hesitancy and skepticism could be due to that fact that there is not yet widespread use of digital currencies across the world. She said that she and the IMF support the advancements in digital currency use.
“I’m a very strong believer in advancing digital payments and access to digital services as a way of inclusion. It is one of the big motivations of the fund to support countries to move towards exploration of central bank digital currencies and stablecoins, because we believe innovation and inclusion go hand in hand,” said Georgieva.
“But we are aware of the risks and we recognize that if we move without the right regulatory framework, trust can very quickly be eroded and there could be the pyramid falling impact with long-term consequences.”
Rolle added that the CBOB is trying to discourage the opinion that digital currencies like the Sand Dollar are cryptocurrencies. He said the purpose of the Sand Dollar is to ensure that The Bahamas’ payment systems are fast and efficient.
“The effort is trying to dissuade people from looking at CBDC as something that they should hoard like a cryptocurrency,” Rolle said.
“We want to maintain the role and the link of the banking system. It’s very important the we don’t view central bank fiat currency as something that is going to function and behave like the crypto assets. We’re trying to make our payment systems operate more efficiently and accelerate the kinds of changes we want to see in our systems, to address costs in intermediate inflows across countries and the like.”
He added that The Bahamas is fortunate to have a high rate of digital inclusion through the use of mobile phones.