Central bank to study nationally backed digital currency

4. Crypto market
(Photo: Jordan News)
AMMAN — The Central Bank of Jordan (CBJ) is studying the possible launching of a digital currency backed by the Jordanian dinar at a fixed exchange rate, according to statements made Sunday by the CBJ’s director.اضافة اعلان

CBJ Director Adel Sharkas made the announcement at a meeting with the Parliamentary Economy and Investment Committee.

The world is developing rapidly and not pursuing opportunities in the digital environment is unacceptable, MP Khair Abu Saalik, head of the parliamentary committee, told Jordan News. He agreed with the CBJ’s decision to explore the viability of an official Jordanian digital currency.

The lawmaker stressed that once the study has been completed, the committee will support it, but “we cannot take any step before we study all aspects ... of the issue in terms of trading, the safety of this currency, the ability to trade it, and its impact on the services of the CBJ."

The legality of the digital a key question, Abu Saalik said, as the trading of digital currencies in Jordan is wholly prohibited.

The deputy concluded by saying that it is too early to judge the impact of these currencies on the economy and investment, and must wait for the results of the CBJ’s study.

Some countries have already started to adopt digital currencies backed by their central banks.

Wajdi Makhamreh, an economist, told Jordan News that Sharkas’ decision is keeping pace with digital developments. While there is not enough information to judge yet, thinking about this step shows promise for Jordan in digital economy, he said.

Makhamreh, too, agreed that it was too early to tell what the effects a Jordanian digital currency would have on the economy.

Economist Yousef Damra told Jordan News that the idea of nationally backed digital currencies is still a new one that requires in-depth research worldwide, but that participants in a study by the International Monetary Fund on the topic were supportive of it.

"The digital currency may be a new tool for drawing monetary policy globally," Damra added. Were it not for experts’ belief that this step positively impacts the Jordanian economy and investment, they would not have presented studying it and talking about it publicly, he said.

Damra stressed that the difference between the digital currencies circulating now and the digital currency that the CBJ is studying is that it will be backed by the Jordanian dinar, meaning that it will be safe for trading as the exchange rate for it will be guaranteed, and its value will also be maintained. Thus, it will be safer to trade than existing decentralized digital currencies such as bitcoin and ethereum.

For its part, the Ministry of Digital Economy and Entrepreneurship said that it is awaiting the results of the CBJ’s study and will issue a statement based on tangible data.

Despite the best efforts of Jordan News, the CBJ were not available for comment.

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