Lebanon’s Central Bank To Issue Digital Currency In 2021
Banque Du Liban, the central bank of Lebanon, is planning to launch a central bank digital currency in 2021.
According to the central bank’s governor, Riad Salameh, the digital currency project aims at restoring confidence in the collapsing banking system.
To the central bank's knowledge, approximately $10 billion are being stored inside the homes of Lebanese citizens. Regardless of the indebted Lebanese government and the struggling local banks, citizens are still putting their faith and trust in the system.
Salameh also pointed out that the central bank's digital currency would be a great help for Lebanon to transition to a cashless system, making it easier to transfer money locally and abroad.
Back in 2017, as Salameh stated when Lebanon only started toying with the idea of launching a central bank-backed digital currency, the main intention to make payments more affordable to the people of Lebanon. Now it appears that the motive changed to boosting people's confidence in the wobbling banking sector.
The country accelerated the process towards the launch of CBDC after mass demonstrations since Lebanon’s banks have implemented harsh capital controls to mitigate the economic and financial crisis, and following property destruction that crippled the country’s financial system. These events even led one of the banks to limit withdrawals to only $400 a month.
Earlier this ear, an unprecedented drop in the value of the lira against the US dollar alarmed the already frustrated Lebanese citizens as this local currency depreciation subsequently led to people losing their savings and salaries.
Once the CBDC is launched, Lebanon will join other nations that have already or are in the process of debuting their own state-governed digital currencies.