Scheduled to launch in mid-October! The Bahamas announces CBDC project milestone, set to become the world's first.

The Central Bank of The Bahamas has announced that it will launch its digital currency, the Sand Dollar, on October 20. The usage of the Sand Dollar will extend directly to the general public, rather than just being limited to businesses or financial institutions, making it potentially the world's first country to operate a Central Bank Digital Currency (CBDC) at a national level.

Minimum Account Opening Requirement: KYC

The majority of the Bahamas' territory is located near the Bermuda Triangle, with a population of only 380,000. Starting from the middle of next month, the country will gradually issue a digital currency called the "Sand Dollar" nationwide. The initial plan is to classify accounts into three types based on different risk levels, all of which require KYC certification.

The first type is the low-value account, meeting the minimum account opening requirements with stricter trading limits.

The second type is the compliant individual account, where active users and existing bank customers will be categorized.

The third type is the commercial and enterprise-level account, requiring a higher level of KYC certification and offering higher transaction and holding limits.

The above first phase plan will run until the first quarter of 2021, with the second phase focusing on building more government and private institutional infrastructure. The central bank stated:

It has integrated and deployed with many financial intermediaries regulated by central banks. Compliant institutions can act as initiators of mobile payment wallets to assist the central bank in maintaining and clearing assets. The central bank will continue to improve payment services and provide the public with more convenient channels for financial services.

Cash is No Longer Anonymous

The official announcement also emphasizes that rigorous cybersecurity assessments have been conducted. These wallets will be protected by "multi-factor authentication," but the Sand Dollar does not provide anonymity, ensuring that all transactions comply with anti-money laundering regulations (AML).

The announcement also mentions the challenges of the widespread use of digital currency, namely the need to educate the public on cybersecurity in electronic payments, continuously promote financial literacy to advocate for digital currency, and encourage the public to be more proactive in personal finance.

In fact, the concept of national digital currencies has been proposed for many years, but no country has yet achieved it. The Bahamas is likely to become the first in the world to do so, indirectly promoting public awareness of Bitcoin. A previous report from Grayscale Investments indicated that CBDCs will "strengthen the value proposition of Bitcoin and other digital currencies." This is because the widespread adoption of CBDCs will naturally compel the public and institutions to become familiar with digital payment infrastructure. On the other hand, the public will also discover the differences between Bitcoin and CBDCs.