Dear Editor,

The recent pilot launch of the digital currency, Sand dollar, by the Central Bank of The Bahamas in Exuma is quite a progressive move in this ever-changing and fast-paced economic climate.

After decades of research, tests and investment through the Bahamian Payments System Modernization Initiative (PSMI) the project has finally been realised.

It should be pointed out that this digital currency is not a typical cryptocurrency. Instead, it’s a digital version of the existing Bahamian paper currency.

The premise behind its launch is to facilitate people throughout the chain islands with a fully digital payment service, as well as to accommodate those who do not have access to a physical bank, especially in instances where commercial banks and other financial entities have sought to downsize or close their operations.

With this in mind, the central bank has worked assiduously to execute the necessary reforms to revamp the payment systems platform to make key banking services and options available to everyone.

Bahamas Finance Minister Kevin Turnquest and The Bahamian central bank must be commended for great foresight and sharp vigilance of the financial landscape to recognise the importance of providing their population with an effective, faster alternative to accessing online banking/payment platform to transact business.

In a world of blockchain and mobile phone technologies, this is, in fact, the best time to explore digital currencies such as these, as not only does the cost of currency creation go down to zero, but modifications can be implemented at a much faster pace as the volume of available digital money is decided through a variable in an application software. There is also the additional benefit of much lower costs, as little to no expenses are incurred in producing and transporting money digitally resulting in recurring revenues for the Government.

Flexibility is yet another major benefit in times of crisis, such as the vast devastation linked to natural disasters such as hurricanes. The digital monetary platform could increase the available money supply for a specified time to rebuild the country’s basic and most crucial amenities.

Lack of trust, corruption, and inadequate regulations have always been alarming concerns synonymous with the implementation of digital currencies, but with the central bank controlling the platform, such a system will not be anonymously managed and payments can be easily traced and monitored as opposed to your typical crypto system.

It is early days yet, but I believe the introduction of the Sand dollar will definitely help to streamline payment services effectively across The Bahamas and result in significant benefits for all stakeholders.

Tara Henry

henry.tara42@gmail.com