After disapproval over the adoption of Bitcoin as a legal tender by the Central African Republic, the IMF (International Monetary Fund) has shifted its focus to the CBDC of the Bahamas, the Sand Dollar.
The agency has recommended that the country’s regulators conduct more supervision and provide more education for citizens. Apart from proposing that the general population in the Bahamas get financial education, the financial agency expressed concern about the need for a “strong supervisory and regulatory framework” for virtual currencies.
IMF Focuses On Bahamas’ Sand Dollar
On Monday, the international organization stated that its executive directors have looked at Bahamas’ Sand Dollar. The agency believes that the CDBC has excellent prospects for increasing financial inclusion. However, it advised the country’s central bank to accelerate its campaign on financial education while strengthening its internal capacity.
The recommendation by the IMF was different from its previous warnings to several countries in the past against the adoption of digital currencies. The suggestion by the monetary organization came when it carried out an Article IV consultation in the country, which took place on Wednesday last week.
The IMF stated that during such consultations, a group of economists would travel to a country to analyze financial and economic trends. Also, they will debate the nation’s monetary policies with the central bank and government officials.
Apart from urging that the people of Bahamas are financially educated on what CBDC and digital currencies are, the IMF expressed concern about the significance of a strong regulatory framework. This framework, under proper supervision, will help to guide the crypto sector.
Bahamas To Allow Tax Payment Using Crypto
In May, Bahamas’ Prime Minister, Philip Davis, informed the news media at SALT’s Cryptocurrency Bahamas summit that the industry has a legislative framework that would allow crypto firms to operate inside its territory. According to the government, the state will enable tax payments using digital assets by collaborating with its central bank and the private sector.
A survey carried out by the monetary department of the BIS (Bank for International Settlements) revealed that 90% of the 81 central banks sampled were carrying out a study on a national CBDC. Also, the research noted that about 60% are likely to issue to CBDC soon. So far, Nigeria and the Bahamas are two countries that have formally established CBDCs. However, other countries, such as China, have been testing CBDCs as part of their economic development strategies.