East Grand Bahama Member of Parliament Kwasi Thompson yesterday suggested the government start paying portions of civil servant salaries in Sand Dollars, as he urged the government to encourage greater adoption of the central bank digital currency (CBDC).
The Bahamas became the first country to develop and issue a CBDC in 2019, outpacing global giants like China and the United States.
Although rolled out nationally in 2020, the Sand Dollars in circulation increased to just $0.304 million in 2021, as The Central Bank of The Bahamas revealed in its annual report that adoption remains low.
Thompson said given that the Sand Dollar is The Bahamas’ mark on the global digital landscape, the government must continue to push Sand Dollar payments, particularly for all government services.
“We must think out of the box when it comes to payment in government services. So if we can pay any bill that we have to pay to the government, that increases the usage of it and the convenience of pay. We started the process and by introducing it as a payment platform but it needs to be expanded. We must also take a proactive role in exposing the public to the use of the Sand dollar. Not a lot of Bahamians use the Sand Dollar, so we must be proactive in ensuring we drive this initiative and allow the public to be more knowledgeable,” he said while contributing to debate in the House of Assembly yesterday.
“This is especially the case for the Family Islands, which can help to solve the lack of banks issue. After Hurricane Dorian and Abaco was devastated and the banks were closed, we had a situation were persons had to take private flights with loads and loads of cash over to Abaco. Banks are closing on all Family Islands, but if we had a more user friendly Sand Dollar system, where more persons used the Sand Dollar, that would alleviate the need to have banks because we are transacting digitally, we wouldn’t need cash.
“We also should have a pilot program where the government could pay a portion of civil servants’ salaries – and obviously the civil servants have to agree – in Sand Dollars, so that again it increases the usage of the Sand Dollar. And of course, we should provide incentives for businesses and people who sign up for the Sand Dollar. We had allocated a certain amount of funding in the Ministry of Finance for the Sand Dollar and we are urging this government to continue working with the Central Bank to increase the usage of the Sand Dollar, it can solve a lot of our banking issues in the Family Islands.”
Parliamentarians were debating the Digital Assets and Registered Exchanges (Amendment) Bill, 2022, which provides a framework for the monitoring and sanctioning of persons carrying on or purporting to carry on digital asset business activities without the requisite registration pursuant to DARE.
Thompson said The Bahamas as another opportunity within the digital assets space for Bahamians to benefit from new technology, and as such the CBOB should further relax exchange controls so that digital asset trading is more accessible to more Bahamians.
“The Central Bank should liberalize exchange controls for virtual currency businesses so that they are able to transact freely. Further, there should be a clear policy exemption from exchange controls for Bahamians buying tokens or coins on an exchange and settling in Bahamian dollars,” he said.