Dozens of cryptocurrencies are storming financial markets, prompting central banks globally to develop their own digital tokens. According to a new PwC report, The Bahamas' Sand Dollar is leading the way in this booming new industry. Issued by the Central Bank of The Bahamas in October 2020, the Sand Dollar is a digital iteration of the Bahamian Dollar - and one of just two fully operational retail CBDCs worldwide. The Sand Dollar holds identical legal status as the standard currency, is issued by authorized financial institutions, and can be used for a variety of transactions.
The Central Bank has remained ahead of the global curve since piloting the Sand Dollar in late 2019. Their intent was to renovate and smooth out the financial framework, diminish service conveyance costs, and boost the efficiency of transactions in the country. The goals of the digital currency are very clear: to increase payment speed, efficiency, and security; to lower the cost of financial services and increase inclusion for all people, regardless of age or status; and to tighten up control over money laundering, forgery, and other cash-enabled fraud. "It also gives an excellent record of income and spending, which may be utilized as supporting documentation for micro-loan applications," the official currency website states.
Many ask why a small country like the Bahamas was able to beat economic giants in this race. It is important to highlight the island jurisdiction's commitment to innovation. The new Bahamas Digital Assets and Registered Exchanges (DARE) Act is considered a "monumental" piece of legislation as it strikes a fine balance between innovation and a robust regulatory framework. As Elsworth Johnson, Minister of Financial Services, Trade & Industry and Immigration, explains Bahamas is pursuing an aggressive public sector digitization initiative.
In sum, like anywhere, all that is necessary for a technology to flourish is adequate government policy and smart regulation. This is the difference between digital policy in the Caribbean country versus most western governments at the moment - they are at the avant-garde of the industry because of laws that promote innovation, safe application & governance of blockchain-based assets, the industry will only flourish. An approach which should be mirrored by all governments.
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