Barbados-based startup Bitt has recently signed a Memorandum of Understanding (MoU) with the Central Bank of Curacao and Sint Maarten (CBCS). The goal of the partnership is to look into the different possibilities and feasibilities of issuing digital guilder or a Central Bank backed cryptocurrency.
CBCS Explores the Idea of a Central Bank backed Cryptocurrency
According to the press release, both parties signed an MOU on August 3, 2018. The signing of the MOU represented an agreement of the discussion which took place during April 2018, when the CBCS had their second Central Banking Conference.
The MOU is an important milestone for both parties because it shows great determination and effort to move ahead and explore new technologies like blockchain technology and to even look into the idea of creating a Central Bank cryptocurrency.
Rawdon Adams, CEO of Bitt Inc, stated:
“The MOU clears the way for collaboration and information sharing regarding a feasibility study, designed to determine the viability and functionality of using a central bank-issued digital guilder within the financial ecosystems of each member, and across both members of the monetary union.”
The goal is to assess whether a Central Bank cryptocurrency could help facilitate financial payments between Curacao and Sint Maarten. In the Carribean, there are approximately seven formal currencies.
Edging Over Fiat Money
Adams noted that a central bank cryptocurrency has significant benefits for member states that are separated by the ocean or long distances like Curacao and Sint Maarten since distributing fiat money across these islands and member states can be difficult, challenging, and expensive.
Adams believes that with central bank-backed cryptocurrencies, the currency can be used on mobiles and can, therefore, create a frictionless and easier financial transaction system. Both member states can benefit much from cross-border transactions, which often take several days, a costly and time-consumptive approach.
Bitt’s vision and mission, to distribute ledge technology to help entities efficient and securely issue cryptocurrencies under clear regulations, therefore, aligns well with CBCS’ direction.