The Central Bank of Tanzania announced that the country would create a Central Bank Digital Currency in a statement from the governing bank’s leader. The governor says the governing financial institution plans the CBDC launch to shield Tanzanians from speculations around blockchain-powered digital assets.
The East African nation hopes to get education from other countries with better know-how on creating digital currencies, like Nigeria. The Tanzanian governing bank’s leader also disclosed that digital assets’ speculations currently affect different persons within its territory.
While speaking at a conference, the bank’s leader disclosed that Tanzania’s governing financial institution is taking action to introduce government-supported digital money to meet up with the global digital trend of governments adopting digital fiat money.
The Bank of International Settlements recently reported that 9 out of every ten central banks globally are thinking of creating a government-supported digital currency. Nigeria broke the jinx on the continent of Africa by setting forward a Central Bank Digital Currency.
Also, China launched its digital currency earlier in 2022. Tanzania’s central bank leader said that it asked some of its staff to other nations to learn from their experience and technical know-how, including Nigeria.
Recently, the Central Bank of Nigeria (CBN) enlarged the functions of its digital currency, approving holders to make bill settlements using electronic money. According to a statement from Nigeria’s governing financial institution, the provision will be made available to holders of the electronic currency from next week.
When defining the contrast between executing transactions using the Internet and the electronic Naira, Nigeria’s CBN leader says that using the latter required no usage costs.
Tanzania’s federal government outlawed digit assets in 2019 because the fiat currency doesn’t back them. However, the federal government revoked its ban, asserting that the nation would plan for the new age of blockchain-supported digital assets.
If Tanzania completes the said plans before other African countries, it will become the
second African nation behind Nigeria to own a State-backed electronic currency. The Bank of Tanzania’s leader didn’t announce when it would launch its virtual currency.
The US Planning towards Launching a Virtual Currency
The United States of America is also reportedly planning to launch its electronic money. The federal government is supporting research towards setting up an electronic US dollar.
Earlier this year, The US president asked for different organizations to begin researching the potential advantages and regulatory options for digital assets, including State-backed electronic money.
Additionally, the researchers would research the technicalities of an electronic asset. Apart from other agencies, information from the White House also demands that the nation’s Federal Reserve continues to make findings on the said subjects.
Analysts say the digital dollar could help change the way the nation regulates the financial sector, taxes, and the accessibility of financial services. Some others say that the digital asset could have a negative effect on the stability of America’s financial system.