The Bahamas Reveal Details, October Date of Landmark Central Bank Digital Currency Debut

The Bahamas confirmed it will cross the central bank digital currency (CBDC) finish line next month.

• In a late Friday tweet, the Central Bank of the Bahamas announced that on Oct. 20 it will begin the "gradual national release" of its consumer-facing "Sand Dollar" digital currency, perhaps the world's first retail CBDC.
• Though it was already known that the Bahamas was eyeing a mid-October release, the Friday announcement sets a hard date for the historic event and sheds new light on the rollout.
• In the first phase, private-sector players such as banks and credit unions will ready their systems with know-your-customer (KYC) and other compliance checks across low-value, personal and enterprise wallets.
• Sand Dollar's second phase, slated for early- through mid-2021, will focus on preparing essential infrastructure services in the government and private sectors, such as utility companies, for the CBDC.
• A growing cadre of financial and payment institutions slated to intersect with Sand Dollar have already invested in building out mobile wallets for their users and have been on-boarded for the rollout accordingly, the central bank said.
• Those wallets will be secured with "multi-factor authentication" safeguards, according to the announcement.
• Users cannot and should not expect to have cash-like anonymity when using the CBDC, the central bank said. Even so, it said Friday that wallets will be encrypted "to ensure confidentiality."
• Additionally, the central bank said it has prepped the CBDC by subjecting it to a "rigorous cybersecurity assessment" to overcome public fears of paying with a digitally native currency.
• Regulations surrounding the Sand Dollar CBDC are still in the works. The central bank said those "will be crystalized in the public space over the month of October."

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“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 said.