UN Commission Calls On Caribbean to Become Digital Currency Hub

A UN commission report suggests digital currencies could be beneficial for the Caribbean region.

AccessTimeIconFeb 5, 2016 at 3:30 p.m. UTC
Updated Sep 11, 2021 at 12:07 p.m. UTC
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The UN Economic Commission for Latin America and the Caribbean (ECLAC) has published a report examining digital currencies and how they can be used to address regional payments issues.

Written with the aim of providing local policymakers with a balanced appraisal of the benefits and risks of digital currencies such as bitcoin, the report examines the use of the technology in the Caribbean and discusses the broader context of its emerging use at the global level.

Notably, the paper recommends further exploration into the technology with the ultimate aim of turning the region into a FinTech and digital currency hotspot.

The author writes:

"Given the deficiencies in the sub-regional payments infrastructure, and the broader need to increase participation in the digital economy, it is incumbent upon Caribbean authorities to ... examine the opportunities for innovation that digital currencies offer."

The commission further considers how digital currencies could address regional deficiencies in the electronic payment infrastructure, and provides an overview of mobile money solutions and their relationship to digital currency.

The study was based on three main sources of data: a literature review of international and regional resources, input from experts in electronic payments and a formal survey of Caribbean central banks.

Inclusive approach

Overall, the author recommends an "inclusive approach" to the exploration of digital currency that provides sufficient opportunity for public input and policy review, similar to the process adopted by the UK.

He further suggests an alignment of policy across the different countries of the region, in order to reduce the costs of compliance and create a competitive marketplace in the region for the digital currency sector.

Officially recognised digital currency initiatives could also be beneficial, the paper says.

Predicting the future increased use of cryptocurrencies in mobile payments, it adds that policy makers, entrepreneurs and academics could look at developing specialised services and products for export, turning the region into a FinTech hub.

Trinidad image via Shutterstock

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