The International Monetary Fund (or IMF) has focused its attention on the Bahamas’ central bank digital currency, the Sand Dollar. It suggested additional regulatory oversight as well as education.
The IMF reported Monday on a consultation with the Caribbean country. It stated that its executive directors “recognized” the Sand Dollar’s potential to foster financial inclusion and recommended that the Central Bank of The Bahamas “accelerate it education campaigns and continue strengthening its internal capacity.” This was a departure from previous warnings by the IMF to many countries against digital asset adoption. However, many of these did not include CBDCs.
This recommendation was made following an Article IV consultation that concluded in the Bahamas on Wednesday. According to the IMF during such a consultation, an economist team visits a country “to evaluate economic and financial developments, and discuss the country’s economic and fiscal policies with government officials and central bank officers.”
The IMF recommended that The Bahamas educate the public financially. It also suggested the importance of a strong regulatory and supervision framework for digital assets. The Bahamas Prime Minister Philip Davis stated to Cointelegraph, during a May interview at the Crypto Bahamas conference. He said that there is a regulatory framework in place in the region that will allow crypto businesses to operate within its territory. In April, Davis’ office stated that the government would allow digital assets to be used for tax payment. This was through collaboration with both the central bank and the private sector.
It was an honor interviewing the Prime Minister of the Bahamas @Cointelegraph @CryptoBahamas. Stay tuned for our coverage! #CryptoBahamas pic.twitter.com/67EtQgRQeT
— Rachel Wolfson (@Rachelwolf00) April 27, 2022
Related: IMF urges El Salvador not to recognize Bitcoin as a tender
The only countries that have launched CBDCs are Nigeria and The Bahamas. However, other countries, including China, have been using digital currencies. The Bank for International Settlements Monetary and Economic Department reported Friday that a survey of 81 central bank officials in 2021 indicated that 90% of them were engaged in CBDC work, and that more than 60% of them were “likely” to issue CBDCs in the medium or short term.