The Central Bank of Tunisia has announced it is the first country to issue a national digital currency on a blockchain.
As reported by local media outlet TASS, the digital currency dubbed ‘E-dinar’ was officially launched at a recent event; with a symbolic transfer of one dinar between the Central Bank head – Marouane El Abassi and a representative of the IMF.
The blockchain-based Central Bank Digital Currency (CBDC) is said to have been developed in partnership with Russian blockchain platform Universa. The partnership sees Tunisia become the first country to issue a fiat-backed CBDC using blockchain technology; after it had converted some of its state capital into this electronic form.
Details show that the E-dinar is now available for online transfer between citizens, with shops and other retail stores slated to accept the currency in the coming months. Subsequently, over 2,000 kiosks will be set up across the country to issue the E-dinar to users who can now add funds to their wallet through a browser or mobile application.
The report notes the Central Bank will look to utilize the E-dinar for cross-border payments hence foregoing the need for US dollars in international trade.
Speaking on Tunisia’s CBDC, CEO of blockchain platform – Universa explained his firm’s use of blockchain technology and its benefits, while highlighting that the E-dinar was more of an electronic money currency rather than a decentralized cryptocurrency. He remarked:
“Electonic banknotes (E-dinar) cannot be faked – each such banknote, like the paper version, is protected by cryptography, it, like the paper counterpart, has its own digital watermarks. And the production of such a banknote is 100 times cheaper than wasting ink, paper, and electricity for printing press.”
This he said as he referenced the huge consumption of resources and challenges with printing fiat money.
It is worthy of note that Universa will receive percentages on all transactions on the system. However access to encryption keys or transaction records are restricted to ensure the sovereignty of Tunisia’s currency.
Other nations represented at the event include Algeria, Morocco and Mauritania, who can join the network for international payments in the future.