In a remarkable development, Kazakhstan has officially launched its central bank digital currency (CBDC), the digital tenge, marking a significant leap in the country’s financial technology landscape. Binur Zhalenov, the chairman of Kazakhstan’s National Payment Corporation (NPC), spearheaded this initiative by executing the first transaction with the digital tenge. This historic moment occurred during the XI Congress of Finance in Almaty on November 15, where Zhalenov utilized a debit card connected to the CBDC account for payment.
This launch is not merely a symbolic step; it signifies Kazakhstan’s commitment to developing a comprehensive digital financial ecosystem. The digital tenge, now accessible on the retail market, is expected to see a “massive platform’s development” in 2024. In a strategic move to ensure seamless integration, the Kazakh government has collaborated with major global payment networks like Visa and Mastercard, along with local banks. This collaboration enables users to make payments with the digital tenge globally, using various digital wallets and gadgets such as Apple Pay and Samsung Pay.
Looking ahead, the digital tenge is poised to revolutionize not only domestic transactions but also international trade. By 2025, the NPC plans to expand its use in cross-border trade, underscoring its utility in the global financial landscape. The digital currency’s design also includes programmable features, making it adaptable for use in smart contracts, innovative financial services, and digital asset transactions. The focus for 2024 is set on enhancing offline payment capabilities of the CBDC.
The journey towards this digital innovation began in February 2023, with the NPC, established in September, leading the charge in developing and implementing the CBDC. Concurrently, the Kazakh authorities are increasing their oversight of the cryptocurrency market, a move seen in the context of the swift rollout of the digital tenge. This heightened scrutiny has affected access to major international crypto exchanges like Coinbase and Kraken, and has led to local crypto mining operators appealing for tax rate adjustments on mining activities.
Kazakhstan’s digital tenge represents a bold stride into the future of finance, positioning the country as a leader in the realm of digital currency innovation.
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