The Central Bank of the Bahamas announced that the central bank’s digital currency, the sand dollar, is expected to achieve full compatibility between different wallet providers within a week.

A recent statement from the Central Bank of Bahrain showed that accredited financial institutions such as payment service providers are expected to be completed in the coming days.

The bank said that the financial institutions involved, which primarily act as potential portfolio providers and exporters of dollar bonds, are subject to strict cyber security assessments. Institutions that have accepted the bank application have already been granted permission to participate, while institutions that intend to use their own applications are still being processed. The deadline is March 31, 2021.

In October 2020, Sand Dollar became the first CBDC in the world to skip the beta phase and officially launch it. The centrally issued digital currency became available for use by all residents of the Bahamas upon release, while integration with the commercial banking system was gradually rolled out. According to the bank, the completion of this integration is now inevitable.

The central bank expects to complete the technical integration of the digital infrastructure with the commercial banking system in the near future. This will create links between portfolios and bank deposit accounts through the Bahamas Automated Clearing House (ACH) and allow funds to be transferred in both directions.

To date, nine institutions have been licensed to operate as CDBC exporters, including four money transfer companies, three payment service institutions, a credit union and a commercial bank. The interaction between these objects allows Sand Dollar to be distributed and used more efficiently in different applications. Each sand dollar is pegged to the value of the Bahamian dollar, which in turn is pegged to the value of the US dollar.

Bahrain’s central bank has also issued a draft of new rules specifically addressing how payment service providers handle the sand dollar, with an alleged focus on consumer protection. The ruling is expected to be completed by 1 May.

“The draft regulation aims to strengthen the existing legal framework governing payment service providers (PSPs), in particular with regard to their provision of services related to the digital currency CBDC,” the statement said.

Source: CoinTelegraph

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