The monetary authority of the Eastern Caribbean states — the Eastern Caribbean Central Bank (ECCB) said in a March 6 press release that it would soon begin a pilot to issue a central bank backed digital currency (CBDC).
The pilot project will be conducted in partnership with fintech startup, Bitt, and will see the release of “a securely minted and issued digital version of the EC dollar (DXCD)” for use throughout the Eastern Carribean Currency Union.
As per the release, the soon to be launched DXCD will facilitate payment between licensed financial institutions as well as non-banking financial institutions. Additionally, merchants and consumers can use the DXCD for business transactions while the digital currency will also facilitate peer-to-peer money transfer “at no cost.”
Speaking in the release, ECCB Governor Timothy N. J. Antoine was quick to emphasize that the pilot project was not the same as the CBDC research and experiments currently carried out by different central banking authorities around the world.
He said about the DXCD,
“This is not an academic exercise. Not only will the digital EC Dollar be the world’s first digital legal tender currency to be issued by a central bank on blockchain but this pilot is also a live CBDC deployment with a view to an eventual phased public rollout.”
The ECCB governor also highlighted that the DXCD would not only be a game changer in the way business is done in the region, but also forms part of strategies that the central bank is adopting to reduce the use of cash by 50% between 2017-2021.
Although the release hailed the DXCD as the first blockchain based central bank digital currency (CBDC), several other countries have rolled out CBDCs in the past. Stmarket.co reported in January that the Marshall Islands has not only released a CBDC but also plans to issue physical copies of the digital currency to citizens.
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