The fintech startup based in Barbados Bitt Inc. has signed a Memorandum of Understanding (MOU) with the Central Bank of Curaçao and Sint Maarten (CBCS) to study the possibility of issuing a digital florin, according to a press release of 12 August.
The parties signed the MOU in order to develop a digital currency of the central bank to facilitate financial payments within the monetary union of Curaçao and Sint Maarten. According to the announcement, the bank is trying to "reduce the level of cash use in the monetary union" and to facilitate "safer, more anti-money laundering (AML) and know your customer (KYC)" transactions between islands. Rawdon Adams, CEO of Bitt Inc, commented on the collaboration:
"The MOU paves the way for collaboration and information sharing for a feasibility study, designed to determine the feasibility and functionality of a digital florin issued by the central bank within the financial ecosystems of each member, and through both members of the monetary union. "
Adams also explained that the printing of fiat money by a central bank and its distribution between the two member states is expensive and demanding. On the contrary, digital money can be used on mobile portfolios and makes it easier to make transactions and payments in the monetary union in a safer way. Leila Matroos-Lasten, President-in-Office of the CBCS, said:
"With this CBCS recognizes the transformative potential of innovation and technology and commits to explore solutions for the efficiency of transactions and inter-jurisdictional digital payments while ensuring compliance and security guarantees obtained with these cutting-edge solutions (fintech) would be beneficial to all. "
In 2017, Bitt Inc. named Rawdon Adams, son of the first Minister of Barbados between 1976 and 1985, as the new CEO. The hiring was seen as part of the company strategy to add weight to its plans in the region. That year the company collaborated with the central bank of Barbados for the progress of the pilot blockchain projects.
Bitt Inc. is a fintech portfolio of Doctors Ventures, a wholly owned subsidiary of Overstock.com, which was founded to develop blockchain-enhanced solutions to "solve real-world problems". Medici Ventures is the majority owner of the tZERO company.
While the Dutch Caribbean bank demonstrates openness to issuing its digital currency, the divisional director of the Dutch Central Bank, Petra Hielkem, said that due to the volatility of cryptocurrencies and the possibility for consumer risks, it can be considered money. He added that while the cryptocurrencies are not "real money", the bank does not intend to ban them.
Iran recently announced its commitment to create its own state cryptocurrency with the aim of circumventing US sanctions, despite the fact that the central bank previously banned national banks and other financial institutions from deal with encryption, citing money laundering concerns.