Legislation is being prepared in The Bahamas to require commercial banks to support the country’s central bank digital currency (CBDC), known as the “Sand Dollar,” in an effort to increase its adoption. The governor of the Bahamas central bank, John Rolle, stated that due to the current low usage of the CBDC, commercial banks will now be legally obligated to distribute the digital currency. The rules regarding the CBDC are expected to be enforced within the next two years. Rolle added that eventually, all commercial banks will be required to provide their clients with access to the central bank digital currency. Despite being introduced in 2020, the Sand Dollar has had limited success, accounting for less than 1% of the currency in the Bahamas. The volume of Sand Dollar wallet top-ups has also significantly decreased. In an attempt to boost adoption of the CBDC and mobile payments, the Bahamas central bank believes that requiring commercial banks to distribute the Sand Dollar is necessary, although it will require significant technological changes for individual banks. The low rates of CBDC uptake are not unique to The Bahamas, as other countries, such as China and Nigeria, have also faced challenges in promoting the adoption of their own CBDCs.
Bahamas Proposes Mandatory Banking Support for its Sand Dollar Central Bank Digital Currency