⚠️ HRF CBDC ⛓️🪙 alert from HRF for South Africa (21-FEB-2024)

🗝️ℹ️ (Key Information)

CBDC Status: Pilot

CBDC Launch: n/a

CBDC Model: n/a

CBDC Issued: n/a

Inflation Rate: 7.04%

One-sentence summary:

🇿🇦 is at the forefront of CBDC exploration with a potential retail CBDC, despite looming hurdles of corruption and a lack of accountability.

✅ The Bank for International Settlements counts 🇿🇦 as a key contributor in the development of two CBDC prototypes, placing the country firmly in the pilot phase.

✅ Alongside prominent international banks, the South African Reserve Bank played a crucial role in facilitating Project Dunbar, a wholesale CBDC pilot aimed at enhancing cross-border transactions.

✅ The South African Reserve Bank has also pioneered its own proof-of-concept, Project Khokha, researching the potential of tokenization and distributed ledger technology in interbank settlement.

✅ The 🇿🇦 Reserve Bank governor, Lesetja Kganyago, casts doubt on the suitability and efficacy of decentralized markets in achieving public policy objectives.

✅ The South African Reserve Bank is exploring the feasibility of a retail CBDC, with potential benefits including enhanced regulatory reporting, robust anti-money laundering measures, and user privacy protection.

✅ Deputy governor, Kuben Naidoo, raises concerns that unregulated cryptocurrency could potentially undermine the authority of the central bank.

✅ Despite scoring well in the Freedom House's 2023 Freedom in the World report, 🇿🇦 grapples with rampant corruption which poses a significant risk to the implementation of CBDCs.

✅ The extensive corruption encountered in 🇿🇦 questions the viability of the government's promises to limit risks associated with CBDCs and also raises concerns around potential political biases influencing CBDC policies.

#CentralBankDigitalCurrency #SouthAfrica #CurrencyPioneers #FinancialInfrastructure #GlobalBanking

Question:

Can the development of a CBDC in a country with prevalent corruption like 🇿🇦 prove beneficial for the public? Could it, paradoxically, lead to a more transparent financial system? Let’s discuss.

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Source of data: https://cbdctracker.hrf.org/home (npub1zhqcda52mrvcc0vkwegwsp5xtpk6l6x5kqx85f06tu9lw5h6xx0scch0dw)

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