Kazakhstan, the world’s third-largest Bitcoin (BTC) mining center after the US and China, has found it feasible to launch its own domestic central bank digital currency (CBDC), the digital tenge. The National Bank of Kazakhstan (NBK) revealed the discovery after the end of the second round of testing.
In late October, Binance CEO Changpeng Zhao announced that Kazakhstan’s CBDC would be integrated into BNB Chain, a blockchain built by the crypto exchange. The country’s primary motivation for conducting research on CBDC was to test its potential to improve financial inclusion, promote competition and innovation in the payments industry, and increase the country’s global competitiveness.
The pilot study focused on offline payments and programmability, suggested including market participants and infrastructure players for different scenarios, and suggested clarifying language to be used by country regulators. A recent research paper reinforced Kazakhstan’s intention to roll out a digital tenge. A rough translation of the report reads:
“Given the need for technological improvements, infrastructure preparation, operational model and regulatory framework development, it is recommended to ensure phased implementation over a period of three years.”
Kazakhstan’s central bank has recommended that a domestic CBDC be made available as early as 2023, with a phased expansion of functionality and commercial operation by the end of 2025.
Related to: Binance has signed a memorandum of understanding with Kazakhstan to combat financial crime
As many Russians crossed the border into neighboring borders amid war-related uncertainties, Kazakhstan announced the legalization of a mechanism to convert cryptocurrencies into cash.
“We are ready to go further. If this financial instrument shows its further relevance and security, it will certainly receive full legal recognition,” said President Kassim-Jomart Tokaev, speaking at the Digital Bridge 2022 international forum.
As Cointelegraph reports, neighboring Georgia has also begun implementing new crypto regulations, becoming a global crypto hub.