Bank of Jamaica mints first $148m block of CBDC
Bank will issue JMD230m in Central Bank Digital Currency, in a pilot exercise that runs until December.
Bank of Jamaica (BOJ) is to issue J$230m (around $148m) in Central Bank Digital Currency to deposit-taking institutions and authorised payment service providers, during a CBDC pilot exercise that will run until December.
Following BOJ's mint of Jamaica’s first batch of CBDC, Jamaican finance minister Nigel Clarke announced that the legislative amendment to accompany CBDCs will be in place before the end of this fiscal year.
According to BOJ governor Richard Byles, the next step after “this significant milestone” is to ensure widespread access and acceptance by taking CBDC to the people.
Deputy governor Natalie Haynes advised that the judging process for the recent public contest to propose a name, tagline, logo and design for Jamaica’s CBDC is complete, and that the winners will be notified and announced soon.
The hybrid model
Bank of Jamaica recently announced the launch of its CBDC as a legal tender solely for domestic use, choosing a hybrid model.
Hybrid CBDC falls somewhere on the spectrum between the wholesale and retail models, and aims to combine the benefits of both.
BOJ chose not to use blockchain
Contextually, BOJ chose not to use the blockchain technology that is often associated with CBDCs.
“That’s not because of any major concerns with blockchain, but rather that BOJ is mindful of the importance of utilising a technological solution that would as seamlessly as possible interface with the country’s payment infrastructures”, said the bank.
The institution has opted for adaptations to traditional technology, integrated with the bank’s Real Time Gross Settlement System.
As legal tender, Jamaica CBCD will co-exist with physical notes in the payment space and can be exchanged dollar for dollar with physical cash. Households and businesses will be able to use CBDC to make payments and to store value.