Turkish central bank announces surprise digital currency pilot for 2021

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Turkey is set to begin trials of a new digital currency in 2021, after the country’s central bank announced it had been working on a digital lira.

The previously undisclosed project is set to roll out in pilot form over the second half of the year, with the announcement the first indication of its kind that the country has been weighing up a digital currency launch.

With the announcement of the pilot scheme, Turkey is now at a more advanced stage of development than other countries with publicly disclosed plans for a central bank digital currency (CBDC).

Naci Ağbal, head of the Turkish central bank, said the conceptual phase had been completed, and the project would now move to a pilot rollout.

“There is an R&D project initiated on digital money. Currently the conceptual phase of this project has been completed. We aim to start pilot tests in the second half of 2021.”

The comments will even come as a surprise to the Bank for International Settlements (BIS), which tracks the progress of CBDC development on a country by country basis, and had previously had no record of Turkey working on any CBDC proposals.

The news comes as countries around the world race to develop their own central bank digital currencies, in order to take advantage of more efficient payment systems and greater transactional utility via the blockchain.

The announcement of the pilot phase puts Turkey in a select band of countries to have progressed from initial concepts. It joins China, Sweden, and the Bahamas in reaching the soft launch/pilot trial phase of development.

Details of the program remain patchy, though local media have been reporting since September on the bank’s efforts to recruit expertise for its crypto research and development team.

To learn more about central bank digital currencies and some of the design decisions that need to be considered when creating and launching it, read nChain’s CBDC playbook.

See also: CoinGeek Live panel, The Future of Banking, Financial Products & Blockchain