British Virgin Islands announce US Dollar backed digital currency, France to test its Central Bank digital currency in Q1 2020 and Germany new proposed law to legalize banks holding Bitcoin
British Virgin Islands Announce US Dollar Backed Digital Currency
Over the last year, more countries have been turning to digital currencies than ever before. Some examples are China and the Marshall Islands, and now it’s time for BVI, the British territory and a popular offshore destination, to join in.
A philanthropic Blockchain startup LifeLabs announced that it’s developing a digital currency named BVI~LIFE together with the British Virgin Islands.
BVI is one of the world’s largest cryptocurrency markets by dollar volume, and has crypto-friendly regulations, along with countries such as Malta. The Islands have about 35,000 residents.
The BVI have used the US dollar since 1959, so the stablecoin will be pegged 1:1 to the dollar. It is expected to reduce transactional fees, increase transaction speed and be accessible to outsiders such as tourists. This won’t be a Central Bank Digital Currency, but essentially a government-approved private currency.
Another interesting feature of BVI~LIFE will be the “Rapid Cash Response” fund. The British Virgin Islands have experienced lots of natural disasters, such as Hurricane Irma. Through the “Rapid Cash Response” fund BVI~LIFE will help citizens access their cash quickly in times like these.
This digital currency initiative could reposition the British Virgin Islands as an important player in blockchain. Moreover, their success may represent an incentive for other countries, especially those with a cash-dominated economy.
France to Test Its Central Bank Digital Currency In Q1 2020
The central bank of France plans to pilot a central bank digital currency (CBDC) for financial institutions in 2020. François Villeroy de Galhau, the governor of the Bank of France, announced that the bank will start testing the digital euro by the end of the first quarter of 2020.
The Bank of France confirmed the news on Twitter.
However, unlike most countries, the French digital token will be restricted to private financial firms and won’t involve retail or individual payments. It is not clear if the Banque de France would make it more accessible at a later time.
According to the report, the Bank of France is trying to improve the efficiency of the financial system, and also get advantage on digital currencies such as Libra.
Some other anti-Libra countries include Germany, Italy, Spain and the Netherlands.
The governor of the Bank of France stated that France should become the first country in the world to issue a CBDC and be an example to other jurisdictions. In the blockchain and crypto area, France has really made significant progress. It is reported that even the country’s high school students will have the opportunity to gain basic knowledge of blockchain and digital currencies in the course of their regular studies.
Germany New Proposed Law To Legalize Banks Holding Bitcoin
In Germany a new law is being proposed. The new bill should enable banks to support the sale and custody of Bitcoin (BTC) and other cryptocurrencies by 2020.
This means customers in Germany will be able to go to Deutsche Bank and buy crypto! Institutionalization cannot get any better!
The bill now needs an agreement between the country’s 16 states, following the successful pass through the German federal parliament. Until today German banks and financial institutions have been prohibited from selling any cryptocurrencies for clients.
News of the new law has been received with enthusiasm from the German industry. “Germany is on its way to play a pioneering role in the regulation of cryptocurrency.” It’s important that the Association of German Banks, which currently represents over 200 financial institutions, has supported the bill. In October, the Association published a paper stating that the European economy “needs a programmable digital euro.”
However, the caution still remains. The German parliament has recently issued a statement that cryptocurrencies like Bitcoin “are not real money,“ having in mind their volatility and alleged limited use for payments.