Bank of Ghana considers introducing a Digital Cedi
The Bank of Ghana (BoG) has revealed that it is tilting towards a central bank digital currency (CBDC) experiment. This was made known by the governor of the apex bank, Ernest Addison, who was speaking during a news conference in Accra, the capital of Ghana. It was revealed at the press conference that the BoG was in the advanced stages of creating a CBDC.
The apex bank Governor also stated that the planned “e-cedi” will pass through developmental and evaluation phases before a decision will be made on a national rollout. According to the BoG Governor, the final stage will involve a pilot study to finalize issues concerning feasibility before the CBDC goes into national circulation.
Providing updates on the level of progress made so far, Addison said that the design phase is already nearing completion and the team is on standby to begin phase two. The pilot study will reportedly involve a limited rollout of the planned e-cedi for mobile payments. In his remarks, he said, “From that pilot, we will be able to determine whether this is feasible and what sort of things need to be tweaked to make it work effectively.”
The BoG has been exploring the possibility of creating a CBDC since late 2019. In June 2020, the central bank confirmed that it was ready to pilot an experimental e-cedi project. The country is looking to pioneer CBDC development in Africa with the BoG Governor stating, “The Bank of Ghana was one of the first African Central Banks to declare that we were working on a digital currency looking at the concept of an e-cedi.”
The central bank governor warned investors to be wary of the volatile nature of virtual currencies when giving comments on Bitcoin (BTC) and altcoins.
According to him the unstable nature of cryptocurrency prices makes them unsuitable as a unit of account and medium of exchange. Instead, the governor stressed the importance of central bank-issued digital money which he concluded as being a better form of digital currency than cryptocurrency.