Kazakhstan unveils report on digital tenge

The National Bank of the Republic of Kazakhstan will study the advantages and risks of implementing the digital tenge. The report for public discussion is posted on the regulator’s website.

According to the project, the digital tenge will become a legal means of payment, a unit of account, and a store of value.

“The digital tenge is not intended to replace cash or non-cash money, but will coexist as an additional form of money,” the report says.

The asset’s two-tier architecture will allow the central bank to issue coins, while banks will conduct operations using them. The regulator says that the technology underlying CBDC will meet the highest cybersecurity standards.

Among the expected benefits of the digital tenge are a more competitive and resilient payment system, improved financial and monetary stability, and greater public trust in government payments.

“To decide on issuing the digital tenge, a comprehensive study of its advantages and risks is necessary, including the objectives addressed by the digital currency, the method of its issuance and dissemination, the technology used, and its impact on monetary policy, financial stability, and the payment ecosystem,” said the regulator’s representatives.

The National Bank of Kazakhstan plans to carry out this work in cooperation with market participants, the expert community, and international partners. Following the discussions, a pilot project of the digital tenge will be launched.

Timelines for the roadmap are not known.

Digital Tenge by ForkLog on Scribd

The authorities first spoke of the possible creation of a national digital currency in July 2020.

In November, central bank specialists began developing various CBDC issuance scenarios.

Under Kazakhstan’s current regulations, digital assets are recognised as property, and the issuance and circulation of Bitcoin is prohibited “except as provided by law.” As of March 2021, this provision had not yet been clarified.

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