In a historic move, Binur Zhalenov, Chairman of Kazakhstan’s National Payment Corporation (NPC), conducted the inaugural transaction using the newly launched central bank digital currency (CBDC), the digital tenge. This significant development was unveiled during Zhalenov’s address at the XI Congress of Finance in Almaty on Nov. 15.
A Leap into the Future and Global Collaboration
Zhalenov demonstrated the practicality of the digital tenge. This was by making a payment through a debit card linked to the CBDC account. Notably, this marks the official introduction of the digital tenge into Kazakhstan’s retail market, with Zhalenov projecting a “massive platform’s development” in 2024.
Collaborating with industry giants such as Visa and Mastercard, alongside local banks, Kazakhstan has seamlessly integrated the CBDC into plastic cards. Zhalenov further emphasized the newfound flexibility. He stated,
“It lets you pay with a digital tenge from anywhere in the world, using Apple Pay, Samsung Pay, and other gadgets.”
The Programmable Nature of Digital Tenge
Beyond traditional transactions, Zhalenov highlighted the programmable potential of the digital tenge. Its applications extend to smart contracts, innovative financial services, and digital asset transactions. Looking ahead to 2024, the focus will shift towards enabling offline payments, while cross-border trade adoption is anticipated by 2025.
Importantly, the journey of developing the digital tenge commenced in February 2023, with an initial launch deadline set for 2025. The NPC, established in September, further played a pivotal role in steering the development and implementation of the CBDC.
Kazakhstan’s Crypto Market Landscape
Simultaneous to the swift CBDC rollout, Kazakh authorities have heightened scrutiny over the crypto market. In September, challenges accessing major international crypto exchanges without a local license were noted. In October, local crypto mining operators addressed President Kassym-Jomart Tokayev in an open letter, seeking a reduction in newly introduced tax rates on mining activities.