Kuwait Studies Issuance of Digital Dinar

In light of many countries’ steps toward issuing their digital currencies, Kuwait was one of the latest countries which showed a growing interest in the Central Bank of Digital Currency (CBDC).

In an interview with The Banker website about Kuwait’s possibility to issue its digital dinar, Governor of the Central Bank of Kuwait (CBK) Basel Al-Haroon said the central bank is closely following up on other countries’ experiences in this regard, pointing out that the bank has already formed a team for research to study the topic.

“The CBK is closely following the experiences of other countries that are issuing CBDCs…Accordingly, it has formed a team of experts from various fields within the CBK to study the topic,” Haroon noted.

Haroon mentioned that the bank is following the pros and cons of issuing CBDCs during the debates happening among stakeholders in various countries.

He asserted the importance that any issuance of CBDC should go in a way that preserves Kuwait’s monetary and financial stability and promotes confidence in the country’s payment system.

“Any such issuance would need to be accomplished in a way that preserves monetary and financial stability while maintaining confidence in Kuwait’s payment system,” according to him.

It is worth noting that Kuwait bans cryptocurrencies. In 2021, the Kuwaiti central bank launched a campaign that warned its citizens about assets like Bitcoin, Ethereum and Dogecoin, saying that they cannot be compared with the currencies, issued by the state.

CBDC’s total value of payments is expected to grow 260,000% in the coming decade to record $213 billion annually by 2030, compared to $100 million in 2023, a new study revealed.

According to Juniper Research, the radical change will occur because of the increasing world governments’ adaption of the CBDCs to bolster financial inclusion and tighten control over how digital payments are made.