The Central Bank of Curacao and Sint Maarten (CBCS) has entered into a partnership with blockchain startup firm Bitt to explore the possibility of introducing a digital currency for Curacao and Sint Maarten island nations.
According to Rawdon Adams, CEO of Bitt, a digital currency will suit both countries, which are constituents of the Netherlands and share the same monetary union. The reason is that the CBCS could greatly reduce risks and costs associated with printing and disbursing fiat money across the monetary union. Furthermore, citizens and residents of the region will find it very convenient.
Regarding Central Bank Digital currency, Adams said
“A central bank issued digital currency, which can be used on mobile wallets, facilitates secure and frictionless financial transactions and payments, using a mobile phone/tablet, within each jurisdiction and across jurisdictions in the monetary union. This solution is particularly powerful in the case of cross-border transactions, which can take days even within a monetary union, and the cost of which is only increasing.”
Leila Matroos-Lasten, acting President of CBCS, is of the opinion that a digital currency will be more compliant with KYC and AML norms. CBCS, which was established in 1828, is the oldest central bank in the Americas.
“The CBCS herewith recognizes the transformative potential of innovation and technology and is committed to exploring solutions regarding efficiency of cross-jurisdictional transactions and digital payments whilst ensuring compliance and security assurances obtained by these state of the art (fintech) solutions. This would be beneficial to everyone.”
Bitt’s other partnerships
Earlier in March, the blockchain company signed a memorandum of understanding (MOU) with the Eastern Caribbean Central Bank (ECCB). Medici Ventures, a subsidiary of the online retailer Overstock, partly owns Bitt. Ironically, Medici Ventures raised its stake to 8.6% in Bitt in the same month the latter signed the agreement with ECCB.
Similar to the MOU signed by Bitt with the CBCS, the primary objective of earlier deal was to build, deploy and trial the technology that could improve the Eastern Caribbean Currency Union’s risk profile through the stringent implementation of AML/KYC and Anti-Terrorism Financing measures and processes. The previous MOU also mentions about exploring the development of a digital currency for the ECCU.
ECCB’s governor Timothy Antoine said “[As] the ECCB promotes the safety and soundness of the financial system in the ECCU, it also has a responsibility to encourage and support innovation consistent with the Bank’s mandate to facilitate the balanced growth and development of member countries. To that end, blockchain technology merits our attention and consideration at this time.”