Bahamas Launching State-Backed Cryptocurrency

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Bahamas Launching State-Backed Cryptocurrency

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The Deputy Prime Minister and Minister of Finance of the Bahamas, Kevin Peter Turnquest, announced at the Bahamas Blockchain and Cryptocurrency Conference that the government would be launching a state-backed cryptocurrency. This will be one of the first state-backed cryptocurrencies ever created.

Deputy Prime Minister Turnquest said, “The production of a modern fully digital payment service is the way forward for this era of governance. A digital Bahamian currency is especially important for the many Family Islands as they have seen many commercial banks downsize and pull out of their communities, leaving them without banking services. As an island nation, where transportation can be an inconvenience for many, especially the elderly, and costly, we must offer financial services digitally and securely.”

The Bahamas is a tropical archipelago east of Florida in the Atlantic Ocean. The gross domestic product (GDP), a measure of the size of the economy, is near USD 9 billion, and the primary fiat currencies in the Bahamas are the USD and Bahamian Dollar (BSD). The BSD is pegged to the USD at a 1:1 ratio, so the reality is the Bahamas does not have a true independent currency. Due to this, there is potential for a state-backed cryptocurrency to become the true native currency of the Bahamas.

As the deputy prime minister says, banking in the Bahamas is relatively difficult since its comprised of many islands. A lot of these islands have low populations, so commercial banks pulled out since it wasn’t profitable, leaving residents without financial services and forcing them to conduct the arduous task of lugging cash by boat between islands. A cryptocurrency would be a secure way to instantly transfer money between islands and would eliminate the need to transport physical cash.

Clearly, the geographic nature of the Bahamas makes it an ideal country to implement cryptocurrency. Combined with the lack of a true native fiat currency, this could result in a state-backed cryptocurrency flourishing across the islands.

 

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