Known for white sand beaches, jovial residents and island beauty, Barbados is a premiere vacation destination. However, in recent years, the small, nearly picture-perfect island has emerged as the epicenter of the fast-growing Caribbean digital currency world. This is in part due to the country’s early adoption of the financial technologies (fintech) sector.
In early February this year, Barbados-based Bitt Inc. launched the Barbadian Digital Dollar (BDD), the Caribbean’s first blockchain-based digital currency. Designed to offer monetization and payment solutions to Caribbean residents who have often struggled with the effects of banking systems that have inadequate infrastructure, the Barbadian Digital Dollar offers a mobile digital interface that makes sending money to anyone easy.
“Commerce can be done with less friction, payment(s) can be made instantly, auditors can cryptographically verify the signatures with unparalleled security,” said Oliver Gale.
Despite being based on the same premise as the global digital currency Bitcoin, the BDD is different from its digital counterpart in that instead of using complicated fractions, one BDD dollar is on par with one dollar issued by the Central Bank of Barbados.
In early April, American online retailer Overstock.com announced that they were investing in the emerging BDD exchange. According to Bitt, the series of four $4 million USD installments grew the company’s valuation to $50 million USD. The investment is also good news for Overstock whose company shares rose 2.8 percent following the announcement.
‘A major im’pediment to economic advancement around the world is the fact that the vast majority of humans are unbanked,” said Patrick M. Byrne, Overstock CEO. ‘Yet mobile penetration in some countries exceeds 100 percent.
Barbados Finance Minister Christopher Sinckler, who was on hand at the April announcement, told the press the government, “pledges its full support to the partnership, and Bitt’s initiative to modernize the financial infrastructure of Barbados and the Caribbean.”
For residents of the island, the digital currency has provided better tools to do business and an easier way to buy goods and manage money. Jeffrey Lipton, Barbados resident and a senior portfolio manager, sees the addition of digital currency to the Barbadian economy as a win-win.
“Small shop owners and business owners are using the BDD to accept payments from tourists and island visitors, creating more business opportunities and transparency,” said Lipton, who runs Barbados-based Fairmont Gloucester Partners.
The long-time resident also notes the ways digital money is helping those living in remote areas. “For small islands like ours banks are in centralized areas while large portions of the population live outside of these areas,” Barbados’ Jeffrey Lipton said. “Having to travel all the way to the city to bank is often a long trek, especially for those without transportation, the BDD is eliminating that.”
Following Bitt’s unveiling in Barbados, the company announced they were also launching a similar service in Trinidad and Tobago based on the local dollar of that region. Bitt founders have also met with a number of other Caribbean central banks to discuss digital monetization solutions.