The Central Bank of Chile will postpone the issuance of its central bank digital currency (CBDC), the digital peso, in order to do additional study.
The bank given the go-ahead in September to create a centralized digital currency, which was supposed to go live earlier this year.
According to a research, the currency “would allow the benefits associated with digital transformation to be amplified while limiting some of its hazards,” and it might help establish a more competitive, resilient, and inclusive payment system.
“However, the research indicates that a final decision on this requires a more in-depth review of its costs and benefits, as well as a more thorough comparison with other policy solutions that address the same concerns,” it said.
The study will look at the detrimental effects on the financial system.
According to the bank, the primary goal of extending research is to prevent detrimental effects on the financial system and monetary policy. According to Reuters, the central bank “will convene seminars with specialists and conduct workshops with public and private players in the financial sector.”
Last year, Chile’s central bank assembled a panel of experts to examine and analyze the CBDC minting process.
According to central bank President Mario Marcel, the use of digital currencies has skyrocketed in Chile, with 40% of Chileans using credit cards or digital transactions.
Regulators around the world are tightening down on digital currency, worried about a fast rising industry that surpassed a record $2 trillion in April.
Chile has also been employing blockchain technology to track the flow and utility of renewable energy in the country.
Last May, Chile’s electrical coordinator (CEN) developed Renova, an energy tracking system.
Renova was founded with the goal of demonstrating that renewable energy can be used to support a sustainable mining industry while also improving job rates in the country.
Chile, a very prosperous South American country, has one of the most stable banking and financial sectors in the region.