Jamaica Becomes 1st Country to Recognize CBDC as Legal Tender

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00:00Welcome back to decentralized news firstly pardon me for the noise in the background as you can see

00:06I'm right by the beach side and there are thousands of tourists here in Italy who are

00:13by the beach and there's a lot of noise just down the street from where I am from the traffic so

00:19apologies for that other than that uh welcome back to decentralized news don't forget to give

00:24us a like and a subscribe I just thought I'd bring this news to you this news concerns Jamaica which

00:31is said to have just become the first country to legalize or recognize CBDC as legal tender so this

00:39is quite interesting uh the move that is obviously being made by Jamaica it's a historic move and the

00:46Bank of Jamaica itself has made the island the first country in the world to pretty much recognize its

00:53central bank digital currency as legal tender so the nation has a largely cash based economy and it's

01:02hoped that by implementing the CBDC many of the unbanked folks will be able to improve their

01:10financial situation in that country the CBDC itself which is called the Jamaica Digital Exchange or Jam

01:18Jamdex Jamdex if you want to pronounce it the right way I guess is now issuable by the central bank

01:25following legislative action by the senate while Jamdex or Jamdex has been in pilot testing since last

01:35year it hasn't officially been released into the world though it will soon they said sometime later this

01:43month so the bank of Jamaica uh the governor uh Richard Biles has said that the new CBDC can be used

01:50for settling any debt in Jamaica it is also a medium of exchange and in the medium of account so let's

01:58just obviously cover what the basics of a CBDC are compared obviously to its accesses custom or cousin

02:05around the world which are cryptocurrencies or stable coins CBDCs are supposed to even be better or more

02:12trustworthy and dependable since they're issued by governments instead of private companies in the

02:18case of stable coins largely and they can be enforced by law and also exchanged on a one-to-one basis for

02:26the physical currency of any particular nation so while not meant to actually replace traditional money

02:32in essence they share essentially some of all of the features of fiat but in just a digital form

02:40critics of uh CBDCs obviously do point to the power of governance or governments to be able to then shut

02:47specific people or entities that they're not in favor with uh out of a financial

02:54um system and uh this is uh something that is inevitable but again more than 100 countries at the moment are

03:03either piloting or looking at uh uh introducing CBDCs at some point which is uh about 95 of the world's

03:11economy either exploring or developing them which is uh quite a large proportion so why did Jamaica

03:20actually uh develop the CBDC they said that like many developing countries uh it has a low levels of usage

03:28of the traditional electronic payment methods that uh people use uh west uh for example uh swift and

03:36uh according to uh a guy from uh notton rose fulbright um a partner focused on fintech they said that

03:46emerging economies appear to view CBDCs as a way to jumpstart the economies and they added that invest in

03:52the sort of existing infrastructure for payments in the developing world is a double-edged sword in

03:58some cases it limits countries uh motivation in terms of uh pursuing uh CBDCs and um but i mean one of

04:07the main advocates of uh jam dicks is the government uh minister of foreign affairs senator kamina johnson

04:15smith who is uh quoted saying that the CBDC will greatly improve the financial well-being of the

04:23people without bank accounts as they are not required to use the digital currency she also explained that

04:29Jamaica's banking issues are part or in part due to people feeling uh that they don't have enough money

04:35to warrant setting up an account as well as a lack of identification which is a problem that the

04:40government is also trying to address with this national identification system so uh it is also

04:47you know said that uh CBDCs will uh typically uh sort of facilitate commercial development since uh the

04:56fees can be lowered or removed completely and uh yeah so let me know what you guys think about this but

05:02in terms of just kind of uh how this CBDC will work with Jamaica the government is maintaining that the

05:08jam dicks outside of the blockchain um will be maintaining it outside the blockchain so it will be

05:15ledgered on a centralized servers and a possible drawback in the eyes of some who are obviously

05:22proponents of uh decentralized systems in order obviously to set it up you still need to uh have a

05:30digital wallet called the link l-y-n-k and the wallets are issued by banks as well as other authorized

05:36service providers though no bank account will be required at any point money can be added to a smart

05:43atm through a wallet provider such as a bank and uh through wallet transfers and by a bank transfer

05:50and payments will also be possible via qr codes and wallet ids and no fees that will be attached to

05:57any transaction so financial services entity uh jmb group is also exploring other use cases of the

06:05cbdc related to e-commerce point of sale and so much more in the government said that constructing

06:11a comprehensive infrastructure surrounding the cbdc's will be essential to their success and whether

06:17that includes more exotic offerings from the world of crypto including d5 opportunities is something that

06:24remains to be seen let me know what you guys think about this move by Jamaica and the introduction of

06:30this cbdc and also don't forget to check out the links in the description like and share our videos

06:36and i will see you guys in the next

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