The Central Bank of The Bahamas has begun pilot testing a digital version of the Bahamian dollar that uses QR codes to let users make payments and transfer funds using their smartphones.
“The intended outcome of Project Sand Dollar is that all residents in the Bahamas would have use of a central bank digital currency, on a modernized technology platform, with an experience and convenience — legally and otherwise — that resembles cash,” the Central Bank explains in a detailed report on the project.
“It is expected that this will allow for reduced service delivery costs, increased transactional efficiency, and an improved overall level of financial inclusion.”
“The anonymity feature of cash is not being replicated, although the Sand Dollar infrastructure would incorporate strict attention to confidentiality and data protection,” the bank adds.
“A digital fiat currency would not be a ‘crypto currency’ in any sense resembling private instruments in existence. It would be an identifiable liability of the Central Bank of The Bahamas, equivalent in every respect to the paper currency.
“Its value would be the same as the existing currency. The digital currency would also not be a stable coin, or a parallel currency, in the sense that it would not derive any value separate from the external reserves backing afforded to the Central Bank’s demand liabilities.”
A TV news report produced by local news service ZNS Network shows residents using the new Sand Dollar to make payments in stores with their mobile phones and includes an interview with John Rolle, governor of the Central Bank of The Bahamas, explaining the bank’s goals: