Ghana's digital cedi must emulate cryptocurrencies, Afroblock states

Ghana's digital cedi must emulate cryptocurrencies, Afroblock states

The latest central bank digital currency (CBDC) initiative from Bank of Ghana (BoG) met with skepticism as Afroblocks, an in-house independent association, speculates lack of clarity on the central bank’s intentions.

Afroblocks (previously Blockchain Society Ghana) has warned BoG to steer away from “old traditional siloed financial thinking” while planning and developing its digital currency.

Rather, Afroblocks co-founder Omar Majdoub said that CBDC’s success in Ghana will be in its ability to emulate modern-day cryptocurrencies, i.e. being borderless and decentralized.

BoG has partnered with a German securities printing firm Giesecke+Devrient (G+D) for the CBDC project, which will provide a solution based on the unique requirements of Ghana and its citizens. The partnership will see G+D use its proprietary CBDC solution Filia to issue Ghana’s digital version of the cedi, which will be tested by local banks, businesses and citizens.

Despite G+D’s involvement in Ghana’s pilot CBDC, Afroblocks co-founder Omar Majdoub noted BOG’s unwillingness to discuss the developments openly with home organizations with similar experience and expertise:

“Public details on the CBDC are very sparse. We would be more than willing to contribute our expertise if called upon.”

Majdoub also questioned Ghana’s stance on crypto assets as the country currently does not offer regulatory clarity related to cryptocurrencies.

Rooting for the success of soon to be launched e-cedi, Majdoub urged the central bank to make its CBDC plans and “intentions regarding cryptocurrencies” available to the general public.

Supporting BoG’s move to pilot CBDC in the region, Ghanaian Vice President Dr. Mahamudu Bawumia said that a “single central payment” system could catalyze trade between the African nations.

At the Fifth Ghana International Trade and Finance Conference, Bawumia said that a digital payments system can rectify the costly and time-consuming process of moving goods across the African borders.