Kazakhstan central bank has concluded a successful month-long pilot project for its digital currency, the digital tenge.
The trial involved diverse applications, such as providing school lunches to children in Almaty through the local Onay card, initially intended for transit. Facilitating these transactions was the Kazpost postal system operator.
Furthermore, collaborating with Visa and Mastercard, four local banks issued plastic cards to focus group members, enabling both online and in-person purchases, as well as ATM cash withdrawals.
Moreover, merchants had the flexibility to accept digital tenge or convert them to “non-cash” tenge, integrating them into existing point-of-sale and QR systems.
Notably, the interoperability demonstrated by these cards, functional both within and outside Kazakhstan, marked a milestone for a central bank digital currency (CBDC).
Kazakhstan Central Bank Digital Tenge: Achievements and 2024 Objectives
The digital tenge’s versatility extended to cross-border payments via SWIFT, issuance of CBDC-backed stablecoins on Binance and KASE platforms, tokenizing gold, collecting value-added tax through smart contracts, and trialing a move-to-earn app.
Subsequently, looking ahead to 2024, Kazakhstan Central Bank and the National Payment Corporation of Kazakhstan (NPCK), responsible for administering the CBDC, have outlined key objectives.
These include expanding the number of intermediary banks, enhancing decentralized finance applications, and enabling offline transactions at scale to enhance financial inclusion in regions with limited internet connectivity.
Future Plans for Kazakhstan’s Digital Tenge
Additionally, increased participation in cross-border payment initiatives, such as Project mBridge, is on the agenda. The regulatory and legislative landscape will see developments alongside efforts to bolster digital tenge security and processing speed.
In an interview preceding the report’s release, NPCK CEO Binur Zhalenov assured the public that the digital tenge would not be leveraged for user surveillance.
However, the commitment to user privacy aligns with the overall positive outcomes of the pilot program and sets the stage for further advancements in Kazakhstan’s digital currency landscape.