The Reserve Bank of South Africa began to search for a contractor to test the state-owned cryptocurrency produced by the Central Bank (CBDC), which will surprise with its properties.
South Africa, a country that is part of an informal association of states called BRICS (Brazil, Russia, India, China and South Africa), will be the first to launch its own state-owned steklokoin – this follows from the documentation posted on the website of the regulator.
Reserve Bank of South Africa is currently in search of a contractor, that is, a private organization that will help the regulator to approach this issue from a digital perspective. The central bank of the country notes that it intends to find out how "the digital currency issued by the regulator can be used as electronic money and as an addition to cash."
The line of reasoning in the Reserve Bank of South Africa echoes the way they think in the central bank of Russia. Recall that the Bank of Russia considered that there is a possibility that the population will continue to prefer cash rubles, and will not use the digital ruble, even if it appears. This is because cash provides noticeable confidentiality of financial transactions.
Meanwhile, despite such questions, the South African regulator intends to continue, if the experiment succeeds and steablecoin gets some kind of circulation, to further develop its development strategy, and with the same contractor who will be chosen there this time.
The concept of state cryptocurrency means that it will be based on the local currency – the South African Rand. In this case, the sole issuer will be only the central bank of the country. The regulator stressed that they do not intend to ensure that digital money would completely oust cash, but noted:
“CBDC must be accepted everywhere as a means of payment, either by any type of business, or by government agencies.”
In addition, the state intends to “read” all transactions that will be conducted using the CBDC, and carry out their further analysis.
It is important that the use of CBDC will imply, according to the plan of the Reserve Bank of South Africa, the rejection of any need to use banks for transactions in the state cryptocurrency.
If we consider that modern digital assets are increasingly beginning to be an alternative to credit organizations, the concept of the regulator of South Africa de facto means abandoning the idea that banks should continue to be an integral part of the current financial system.
Publication date 29.05.2019
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