The Central Bank Digital Currency (CBDC) has steadily become a serious discussion among governments around the world, and Kazakhstan is the latest country to announce its plan. The National Bank of Kazakhstan is preparing for the upcoming CBDC pilot program.

National Bank issued a public consultation document

According to an announcement published on its website, the bank is expected to test its digital Tengger prototype in private companies in the financial industry in the first phase.

Participants will use CBDC to provide payment services by building a two-tier architecture of digital currency.

Having said that, in order to ensure the normal launch of Kazakhstan’s digital resilience, the National Bank expects “by defining the definition of the tasks solved by digital currency, its emission and distribution methods, a comprehensive study of benefits and risks, the technology used, and the currency Policy, financial stability and the impact of the payment ecosystem.”

At the same time, the bank also issued a 34-page public consultation document to collect feedback from locals and assess the potential impact of virtual assets into the national economy.

However, the National Bank of Kazakhstan did not disclose an approximate deadline for when the pilot will be deployed or when it will end, implying that it may depend on the evolution of CBDC performance among the participants involved.

Kazakhstan’s position on cryptocurrencies

Although the country initially adopted a harsh stance in 2018, the country has always shown some interest in the cryptocurrency industry and even hinted that it may ban digital asset trading and mining.

In order to alleviate the coronavirus-driven economic crisis, the Ministry of Economic Affairs proposed in August 2020 to impose a 15% tax on virtual currency mining.

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In addition, in September 2020, Kazakhstan’s Minister of Digital Development, Bagdat Mussin, revealed that the government plans to achieve a cryptocurrency mining investment goal of US$714 million in the next three years.

What do you think of the announcement of the launch of the CBDC pilot program in Kazakhstan? Let us know in the comments section below.

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