The digital stimulus pilot token, developed by Stablehouse, aims to showcase how blockchain technology can increase access to digital payments, while solving some of the inherent challenges with stimulus programs
Stablehouse, a pioneering payment and FX exchange platform for stablecoins, and the Government of Bermuda have commenced a test pilot program for a digital stimulus token. The goal of the pilot is to explore and demonstrate the viability of digital tokens to enable the purchase of food and essential products and services through participating on-island merchants and retailers.
A private beta pilot has begun with a select group of consumers and merchants to provide initial feedback and validation on the use of a stimulus token for in-person payments. The pilot is supported by the digital token created by Stablehouse, a wallet app, and a point-of-sale solution. On successful completion of the private beta pilot, additional phases are being proposed in collaboration with the Bermuda Economic Development Corporation for a wider public roll out with select merchants in Bermuda’s Economic Empowerment Zones.
Bermuda Premier David Burt said, “Bermuda is keen to establish itself as a leader in supporting innovative private sector digital asset solutions and to work with locally licensed companies to drive digital asset adoption. A key part of that is not just creating regulatory frameworks but also actually working with and using the products created by companies that choose Bermuda as their home.”
The stimulus token project has been in development since late 2019 as part of the Government of Bermuda’s wider currency standard initiative to support the adoption of digital currencies on island. Those plans have been accelerated due to the COVID-19 outbreak as the need for fast and effective dissemination of financial aid to the population through digital payments technology has become more apparent.
Moving forward, the Government of Bermuda believes that other, similar tokens may also serve to alleviate some of the challenges and costs associated with local payment options. The Government is keen to embrace and work with players like Stablehouse, who hold a Digital Asset Business license, to pilot and drive adoption of innovative private sector solutions in this fast changing space.
The pilot stimulus token is based on Blockstream’s Liquid blockchain protocol, which is well suited for small value retail transactions. Initial testing is being done through Blockstream’s open source Greenwallet app and a point-of-sale terminal provided by Stablehouse. The token will also be available via Stablehouse’s open-source payments app, which is anticipated to launch in the coming months. Given the choice of an open public protocol as the foundation for the token, any liquid compatible software or wallet could also be used.
Philippe Bekhazi, CEO of Stablehouse, said, “The COVID-19 Pandemic has laid bare the need for digital payments solutions to help businesses survive and overcome an uncertain and challenging market backdrop. The stimulus token is designed exactly to do that, by giving merchants more accessible and practical payments options in the evolving digital age. For consumers, it alleviates the dependency on cash amid the ongoing health concerns, while providing an easy and convenient payment channel. Together, with the Government of Bermuda, we aim to set a benchmark for all governments around the world to pursue digital stimulus solutions.”
Earlier in the year, several notable governments, including those made up by the G-20 nations, explored digital solutions as an answer to fiscal and monetary stimulus efforts. Amid the height of the global pandemic, U.S. lawmakers evaluated a digital dollar that was aimed to alleviate the economic fallout from COVID-19 on U.S. taxpayers and protect the economy against any downward spiral. Through the collaboration with Stablehouse, Bermuda aspires to be among the first in the world to offer digital stimulus tokens to its citizens during this innovative test pilot.
Premier Burt concluded, “I am pleased to say that I have personally participated in the pilot and am encouraged by the potential to provide a platform for stimulus programs. It also shows great promise as a means to help make digital payments more accessible to small businesses and entrepreneurs which is particularly important in this challenging economic climate.”