British Virgin Islands to roll out digital currency

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The British Virgin Islands has revealed that it’s rolling out a national digital currency. BVI has been reliant on the U.S. dollar and the digital currency will enable it to break the reliance. The currency is expected to reduce fees and increase speed in day-to-day transactions.

The BVI government partnered with LIFElabs, a blockchain startup founded in 2017 in its venture. The currency, known as the BVI-LIFE will be pegged 1:1 against the U.S. dollar, a press release by LIFElabs revealed.

The BVI Prime Minister Andrew Fahie believes that blockchain technology and the new digital currency will enable the territory to become a global financial hub. He stated, “The importance of blockchain technology and the significant benefits it offers the BVI, are paramount to the Territory. We welcome this innovation with open arms.  Our partner, LIFElabs, has demonstrated with their proven track record that their ideology is not just mere words, and we look forward to continuing our partnership with them on the rollout of BVI~LIFE, our digital currency.”

However, as noted by Ledger Insights, the announcement didn’t mention that BVI-LIFE will be a central bank digital currency (CBDC). Even in his speech, Fahie steered clear of mentioning CBDC, stating, “We also have blockchain technology that looks at our digital currency, which offers significant benefits it offers the BVI, which are paramount to the Territory. We welcome this innovative technological advancement with open arms.”

LIFElabs confirmed that indeed, BVI-LIFE will not be a CBDC. A spokesperson clarified:

The currency is developed by a third party, but will be deployed and managed by the Government of the British Virgin Islands, in junction with LIFElabs global.

The digital currency comes as no surprise, given the continued support the islands have offered to crypto companies. Despite being quite small, with a population of less than 35,000, the islands are one of the largest crypto markets by dollar volume. Bitfinex and Tether are some of the global crypto firms registered in the territory.

The British Virgin Islands have taken a bold step that other countries have been exploring for years. China is one of these countries and despite reportedly conducting research on digital currencies for over five years, it’s yet to make any substantial step towards issuance. Ghana also revealed recently that it’s walking a similar path. However, just like with China, it has taken no step yet towards making this a reality.