In Jamaica, the CBDC Jam-Dex is declared an official means of payment for the first time. The digital Jamaican dollar is the first digital central bank money to achieve such a legal status worldwide.
Digital Jamaican dollar will soon be official currency
Under the official name Jam-Dex (Jamaican Digital Exchange), the digital Jamaican dollar is to receive the status of a legal tender this month. So the CBCD will become the official national currency in Jamaica – so Blockworks reports.
Recently, the Jamaican Senate created the necessary legal conditions for this and legitimized an issue of the digital currency by the Central Bank Bank of Jamaica (BoJ).
Thanks to a new law, digital money can now also serve as the official national currency. However, a few days or a few weeks may pass until it is actually so far.
In any case, one wants to reach the milestone this month, says Richard Byles as director of the Jamaican Central Bank.
The CBDC started as a pilot project in 2021, before it was published last April. The first 100,000 users were equipped with an airdrop of 2,500 Jamaican dollars (currently 16.27 US dollars or 15.18 euros).
Jam-Dex is not a decentralized exchange
In the field of digital currencies, the term DEX usually refers to a decentralized crypto exchange. In this case, however, it is part of the name of the Jamaican CBDC.
The BoJ should have known since February at the latest that this could lead to confusion. At that time, the name of the currency and its logo were announced on Twitter.
As the saying goes, “Mi inna mi ackee!”… With the completion of our CBDC name, logo, tagline and image design competition – Bank of Jamaica’s digital currency now has a name! See the press release for full details: https://t.co/YqFKi1BV0G #BoJspeaks #CBDCJa pic.twitter.com/fqXglyAJBH
– Bank of Jamaica (@CentralBankJA) February 17, 2022
On Twitter, the message was not met with too much love. In addition to the name, many users complained about the graphic design of the icon.
Is the Jam-Dex the better alternative to cash?
So far, cash has played by far the largest role in Jamaica. But the Jam-Dex should change that soon. Jonathan Dharmapalan, managing director of eCurrency company, which develops technology for issuing CBDCs, said:
It is important that people understand that their money can also exist in digital form.
Therefore, in comparison with cash, new opportunities are emerging for Jamaicans, which he considers extremely powerful.
Because it’s digital, you don’t have to be in the same place at the same time to make a transaction. It’s a very, very powerful tool.
Since the Jam-Dex will receive the status of a full-fledged official means of payment, it will also be possible to simply pay everything with it in the near future.
You can use it to pay off all debts in Jamaica. It is the medium of exchange. It is the medium of the bill.
Dharmapalan only draws attention to the advantages of a CBDC. In the crypto scene, on the other hand, digital central bank money is considered a red rag. It is perceived as the exact opposite of a classic cryptocurrency such as Bitcoin.
A CBDC makes it possible for the government to track all transactions and even block unwanted payments or users. In contrast to cryptocurrencies, personal responsibility does not increase, but it decreases even further compared to fiat cash.
Economists criticize Central Bank Digital Currency (CBDC)
Two economists from the University of Würzburg criticize the introduction of state digital currencies as an insufficient substitute for physical money.
Many governments around the world are aware of these properties and are therefore working on their own CBDCs. The most well-known examples are China with the digital yuan and Nigeria with the e-Naira.
The government’s plan to use CBDCs is not working everywhere. In Ecuador, a project was already launched in 2014, which was abolished three years later due to strict rejection by the inhabitants of the country.
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