Soramitsu, the company that assisted in the development of Cambodia’s Bakong digital payment system, will collaborate with the Laotian government to do a study on the potential structure of a Laotian CBDC.
Laos has become the latest country to announce plans to conduct research on a central bank digital currency (CBDC), partnering with Japanese distributed ledger technology (DLT) firm Soramitsu.
According to a Nikkei Asia report published Oct. 3, the initiative is likely to begin this month, following the signing of a memorandum of understanding between Laos’ central bank and the Japan International Cooperation Agency to research CBDC development.
The study will examine the operations of banks and other financial intermediaries within the financial system, as well as the Laotian public’s overall transactional demands.
According to the paper, a CBDC would provide better economic statistics to Laotian policymakers and might open the way for cross-border CBDC-based settlements with Laos’ neighbor and second-largest trading partner, China.
Soramitsu collaborated with Cambodia to establish the Bakong digital payment system, a distributed ledger technology-based payments network aimed at reducing the country’s dependency on US dollars for internal commerce.
Since its October 2020 launch, the Bakong app has been downloaded around 200,000 times and is currently supported by approximately 2,000 retailers. The Laotian government’s decision to investigate establishing a CBDC appears to have been motivated by a desire to explore more permissive digital asset regulation.
On Sept. 11, the administration approved a public-private pilot program to investigate cryptocurrency mining and trading in order to capitalize on China’s recent crackdown on the mining sector and the ensuing migration of industrial-scale miners.
As part of the scheme, six entities, including banks and construction firms, have been granted licenses to generate crypto assets.
Several government agencies, coordinated by the Ministry of Technology and Communications, have also begun writing legislation controlling the usage of digital assets in Laos in collaboration with the Bank of Laos and the country’s main power utility, Electricite du Laos.
The country’s central bank, on the other hand, issued a warning to the public about the dangers connected with uncontrolled crypto assets such as Bitcoin and Ethereum.
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