The central bank of Georgia has said it is assessing whether to launch a central bank digital currency (CBDC), in a move that would see them follow in the footsteps of numerous other central banks worldwide.
The National Bank of Georgia said this week it was considering launching a digital Lari, which it hoped would help the nation benefit from the advantages of CBDCs as outlined by other countries.
Among the benefits it is hoping for is greater financial inclusion, more government sovereignty over monetary and payments systems, and a streamlined process for settlement transactions on the blockchain.
The project, known as Digital GEL, would see the central bank develop a digital currency in line with the technical standards set out by the Bank for International Settlements, which it is hoped will ultimately allow different international digital currencies to be exchanged interoperably across payment and other systems.
The announcement from the bank is also intended as a call for collaboration, with the bank keen to work with private sector interests in shaping the new system, though the plans so far do not explicitly mention blockchain as an underlying technology.
Neighboring countries of Turkey and Russia are already at more advanced stages of developing their central bank digital currencies, and Georgia’s announcement brings them in line with a number of other major central banks across the region and the wider world.
Though much of the progress so far has been made across large economies, including China which is the leader of the major global economies in developing its digital currency, other smaller economies have been agile in developing and rolling out CBDCs, on account of their less complex economies.
While Georgia’s central bank is significantly smaller, and thereby less influential on the global stage, its move towards a CBDC is yet further confirmation of the international trend towards government-backed digital currencies.