The Bahamas is poised to introduce new regulations that will require commercial banks to facilitate access to its central bank digital currency (CBDC), the Sand Dollar. This initiative aims to bolster the adoption and continued use of the digital currency, which was launched in 2020 but has seen limited uptake.
Central Bank Governor John Rolle announced the forthcoming regulations, highlighting the need to support the Sand Dollar. Despite being a pioneer in the issuance of a CBDC, the Bahamas has found that the Sand Dollar represents less than 1% of the nation’s currency in circulation. Recent statistics reveal a sharp decline in wallet top-ups, dropping from $49.8 million last year to just $12 million over the past eight months.
Under the new regulations, banks will be required to integrate the Sand Dollar into their operations within two years. This move is part of a broader effort to address the challenges faced by CBDCs in achieving widespread adoption, similar to the experiences of Nigeria and Jamaica.
The Bahamian strategy contrasts with approaches in other countries. For example, India incentivizes digital currency use with cash-back options, while Israel has proposed setting interest rates for holding CBDCs.
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