The Central Bank Digital Currency – Lessons learned from Bahamas

Abstract

The Fourth Industrial Revolution has impacted positively on the financial system. Digitalisation in various aspects is one of the greatest advances in finance. Thanks to transformation, financial requirements are proceeding rapidly, safely, and conveniently. Nations aim at cashless society in tandem with financial inclusion as well as enhancing the opportunity for growing up microfinance and peer-to-peer payments. Besides existing currencies, there is an essential demand for a stable and secure currency which performs clearing and settlement payments. Central Bank Digital Currency (CBDC) has an appropriate nature to satisfy the requirements for an up-to-date and optimal currency issued by the Central Bank. In Vietnam, recently, the process of digitization has taken place dynamically; moreover, the attention to CBDC has also increased. In line with several monetary benefits, CBDC also assists SBV to consolidate its role in monetary activities. Therefore, conducting CBDC studies is significant. The journey from research to circulation of CBDC requires thoughtful consideration and lessons learned from a pioneer such as the Bahamas which is the only country still exchanging CBDC. Therefore, the purpose of this article is to study the experience from the Bahamas, an important premise for Vietnam, to prepare and modify efficiently before CBDC officially circulates in Vietnam.