Bahamas wants to force banks to support its ‘Sand Dollar’ CBDC

Tom Mitchelhill4 hours agoBahamas wants to force banks to support its ‘Sand Dollar’ CBDCThe Bahamas was one of the first countries in the world to launch a central bank digital currency — the “Sand Dollar” in 2020 — and is now looking for ways to boost its adoption.898 Total views21 Total sharesListen to article 0:00NewsOwn this piece of crypto historyCollect this article as NFTJoin us on social networksThe Bahamas is preparing to introduce legislation requiring commercial banks to support its “Sand Dollar” central bank digital currency (CBDC) and hopefully boost its adoption.

In a June 2 report from Reuters, John Rolle — the governor of the Bahamas central bank — said that due to a less-than-ideal uptake of the CBDC thus far, commercial banks are now being told they will be legally required to distribute the digital money.

Rolle said the CBDC rules should be ready to be enforced sometime within the next two years.

“We foresee a process where all of the commercial banks will eventually be in that space and they will be required to provide their clients with access to the central bank digital currency,” Rolle added.The Central Bank of The Bahamas. Source: Sand Dollar

Adoption of the Sand Dollar has been somewhat lackluster in the country, with the CBDC reportedly accounting for less than 1% of the currency in the Bahamas — despite it being introduced in 2020.

Meanwhile, the total volume of Sand Dollar wallet top-ups has fallen to just $12 million between January and August last year, plummeting from $49.8 million in the same time frame in 2022.

While requiring commercial banks to distribute the Sand Dollar would mean significant tech overhauls for individual banks, the Bahamas central bank says boosting adoption of the CBDC and mobile payments more broadly is crucial.

The Bahamas isn’t the only country to witness lower-than-expected rates of CBDC uptake.

Related:Banque de France, Hong Kong Monetary Authority explore CBDC, tokenization

Several government workers enrolled in China’s CBDC pilot program said in May theypreferred to cash out their digital “e-CNY” for traditional cash, citing limited usability and concerns about government surveillance.

Nigeria, the pioneer of CBDCs in Africa, is facing similar issues.

Despite many attempts to boost adoption, the country has seen rates of CBDC uptake dwindle among its citizens. As of mid-2023,less than 1% of Nigerians with bank accounts had eNaira wallets, and less than 1.5% of those wallets were active weekly.

The Bahamas was the first country in the world to introduce a CBDC, issuing its Sand Dollar digital currency to all 393,000 residents in October 2020.

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