Solomon Islands authorities have launched the retail and wholesale versions of a central bank digital currency (CBDC) in a limited fashion as part of a proof-of-concept phase.
The Central Bank of Solomon Islands (CBSI) has begun the proof-of-concept process for a local CBDC called Bokolo Cash. This was announced by representatives of Japanese FinTech company Soramitsu, the technical partner of the project.
Bokolo Cash will serve as a digital equivalent of the Solomon Islands dollar. The asset will be locally deployed on a specially designed blockchain network based on Hyperledger’s Iroha. It’ll also be available on the public blockchain network Sora for users of the non-custodial Fearless Wallet developed by Soramitsu.
Testing participants will be able to use it for retail transactions in Honiara, the island nation’s capital, and for personal transfers. Project participants will be required to undergo a two-tier KYC verification process. The project will also test wholesale transfers between commercial banks, simulated cross-border payments, and remittances.
Manasseh Sogavare, Prime Minister of Solomon Islands, said in a speech to mark the launch of Bokolo Cash that the main objectives are to increase financial inclusion for citizens and improve the economic resilience and overall prosperity of the country. In addition, the CBDC will reduce transaction costs, ensure transparent and secure transactions, and promote financial innovation in the country.
Soramitsu has extensive experience in launching digital assets and financial DLT infrastructures. In 2020, the company launched the project of the Cambodian digital currency Bakong, which became available as a means of payment in the Alipay trading network in November this year. Moreover, it was reported in August that Soramitsu was developing a cross-border payment blockchain system based on Bakong, which would potentially unite the economic space of Japan, India, China, and Southeast Asian countries.
Soramitsu also helped the central bank of Laos launch a pilot of a local CBDC, the Digital Lao Kip (DLak), in February 2023. The launch, as in the Solomon Islands, was as part of a proof-of-concept process.
