African countries are busy testing regulatory sandboxes for government-owned stablecoins or planning to launch a pilot project in the coming years. About 25% (6 of 23 central banks surveyed) plan to introduce their own CBDCs in the next five years, while Nigeria launched the electronic naira back in October 2021, the IMF report said.
The interest of central banks in CBDC indicates a willingness to increase the access of citizens of their countries to financial services, the IMF believes. The launch of state digital currencies will increase the efficiency of international payments and ensure transparency and security of financial transactions.
The decline in cash transactions due to the coronavirus pandemic and the increase in people's interest in crypto assets have increased concerns among most central banks about monetary sovereignty. Therefore, the IMF concludes, regulators have become more active in planning the launch of CBDC and working on the development of their own digital payment systems, studying distributed ledger technology (DLT).
One of the factors holding back the launch of CBDC was legal difficulties. It is necessary to clarify the legislation: who is responsible for issuing digital currencies of the Central Bank and storing them, who should compensate for possible losses, who should be responsible for the security and confidentiality of user data. 55% of central banks surveyed will have to change local laws before issuing a CBDC. In accordance with the current legislation of some African states, only banknotes and coins are considered legal tender, the authors of the IMF report say.
In 2021, the Central Bank of Ghana began testing a digital Ghanaian cedi, and in 2022, the Central Bank of Kenya launched a public debate on the risks and benefits of a digital Kenyan shilling.
Source: Bits

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