South Africa: Crypto & CBDC Explored for Payments Boost

South Africa’s central bank, the SARB, has created a plan for digital payments to boost the use of these technologies in the country, which currently lags behind.

This plan outlines methods for utilizing cryptocurrency and Central Bank Digital Currencies (CBDCs) to expand access to financial services and build a robust foundation for digital payments.

The central bank is currently researching to enable selected financial institutions to experiment with fiat-backed stablecoins in its regulatory sandbox for a duration of two years. The ability to transfer these digital assets could attract numerous individuals towards cryptocurrencies. However, this innovation also emphasizes the importance of regulations being put in place before widespread usage becomes prevalent.

Furthermore, the bank continues its exploration into retail central bank digital currency (CBDC), offering potential advantages such as cost-effective and swift money transfers for everyday purchases.

The plan outlines solutions for overcoming challenges related to transforming assets into digital tokens, known as tokenization, while adhering to a particular regulatory framework.

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2024-04-23 03:32