July 2, 2022
  • July 2, 2022

Tanzania prepares to launch its own central bank digital currency

By on November 29, 2021 0

Tanzania’s central bank will soon launch its own digital currency. Governor Florens Luoga revealed the news on Thursday at the “20th Conference of Financial Institutions (COFI)” hosted by the central bank.

Luoga said, quoted by Bloomberg, “The Bank of Tanzania has already started preparing to have its own central bank digital currencies (CBDCs) to ensure the country is not left behind in the adoption of CBDCs. “.

A CBDC is legal tender issued by a central bank in digital form. It is the same as fiat money and is exchangeable one by one with fiat money.

This development comes after Nigeria rolled out its own CBDC. At the end of October, Nigeria launched its CBDC, eNaira. In doing so, it joined the Bahamas and five eastern Caribbean islands as the only economies to have introduced CBDCs. This is a short list, but one that is likely to be completed. CBDC pilots are underway in at least 17 other countries.

As of 2019, cryptocurrencies have been widely banned in Tanzania after the country’s central bank said digital assets were not recognized by local law. For Nigeria, the country’s central bank has banned financial institutions from providing services to crypto exchanges. Following the ban, peer-to-peer transactions represent the bulk of crypto trading activity in Nigeria.

In India, the Reserve Bank of India (RBI) said central banks were exploring Distributed Ledger Technology (DLT) for application in improving financial market infrastructure and seeing it as a potential technology solution for the market. implementation of the CBDC.

Meanwhile, the Cryptocurrency and Official Digital Currency Regulation Bill, 2021, is set to be introduced in the Winter Session of Parliament which aims to “create a framework to facilitate the creation of the official digital currency to be issued by the Reserve Bank of India ”. The bill “seeks to ban all private cryptocurrencies in India, however, it allows certain exceptions to promote the underlying technology of the cryptocurrency and its uses.”