Crypto

Ghana gearing for central bank digital currency pilot

The Bank of Ghana (BoG) is reportedly moving towards the introduction of a central bank digital currency (CBDC) experiment.

Speaking during a news conference in Ghana’s capital, Accra, on Monday, Ernest Addison, governor of the country’s central bank revealed that the BoG was in the advanced stages of creating a CBDC.

As part of his address, Addison said that the planned e-cedi will pass through developmental and evaluation phases before a decision will be made on a national rollout.

According to the BoG governor, the final stage will involve a pilot study to finalize issues concerning feasibility before the CBDC goes into national circulation.

Detailing the process made so far, Addison said that the design phase is already nearing completion with the implementation team on standby for phase two. The pilot study will reportedly involve a limited rollout of the planned e-cedi for mobile payments.

“From that pilot, we will be able to determine whether this is feasible and what sort of things need to be tweaked to make it work effectively,” the central bank governor added.

For Addison, the country is looking to pioneer CBDC development on the continent, stating:

“The Bank of Ghana was one of the first African Central Banks to declare that we were working on a digital currency looking at the concept of an e-cedi.”

Indeed, as previously reported by Gist Vile, the BoG has been exploring the possibility of creating a CBDC since late 2019. In June 2020, the central bank confirmed that it was ready to pilot an experimental e-cedi project.

Commenting on Bitcoin (BTC) and cryptocurrencies, the central bank governor warned investors to be wary of the volatility of virtual currencies. According to Addison the unstable nature of crypto prices make them unsuitable as a unit of account and medium of exchange.

Instead, Addison called for more emphasis on central bank-issued digital money which the BoG governor identified as being a better form of digital currency than crypto.