Stimulus token scheme stalled, more than two years on
The next step of a pilot programme using digital tokens to benefit vendors and residents has been delayed, the Ministry of Finance confirmed.
The Digital Stimulus programme, announced in September 2020, was designed to use a cryptocurrency model for financial assistance and commerce – and would have made Bermuda one of the first countries in the world to do so.
But a spokeswoman for the finance ministry said: “The next phase of the Digital Stimulus project has been delayed while the service provider worked to address technical matters, including tweaks to the platform.
“Additionally, as the fintech industry continues to grow and evolve, the government of Bermuda has used this period to re-evaluate the scope and scale of the project to best take advantage of developing opportunities.
“The project is expected to be rolled out next year, and is still envisaged to involve businesses within the economic empowerment zones and provide practical experience for a number of Bermuda College students.”
The pilot programme, developed in partnership with the foreign exchange company Stablehouse, would send digital tokens to a digital wallet on a recipient's phone.
The tokens could be used to pay for goods and services at participating vendors by scanning a QR code on a small point-of-sale device.
The vendor could later press a redeem button and transfer the tokens to a Stablehouse government account in exchange for a cash wire transfer.
The tokens, called Stablecoins, will be backed one-to-one to the Bermudian dollar.
The Government conceived of the programme in 2019 and saw it as a way to economically support those who used financial aid, as well as businesses in economic empowerment zones, or EEZs.
The digital tokens were intended to bypass the sluggishness of bank services or cheque deliveries to offer people immediate and useable currency.
The economic breakdown seen under the Covid-19 pandemic pushed the Government to speed up the roll out of the project.
The pilot programme itself started in 2020 with a small select group of vendors and consumers to offer feedback on in-person payments.
If testing is successful, additional phases will be proposed in collaboration with the Bermuda Economic Development Corporation for a wider public roll out with select merchants in Bermuda's Economic Empowerment Zones