One of the world’s first central bank digital currencies (CBDCs) – the Eastern Caribbean Central Bank (ECCB)’s DCash – has been hit by a ‘technical issue’ causing a service interruption.
The ECCB, the monetary authority for eight island economies including St Lucia and Grenada, launched blockchain-based DCash in March last year, in doing so becoming the first ‘live’ CBDC within a currency union.
The digital version of the Eastern Caribbean dollar initially launched in four of the Eastern Caribbean Currency Union (ECCU)’s territories last year, with DCash’s status as a relative CBDC pioneer capturing the attention of monetary authorities worldwide.
But on 14 January the ECCB posted a ‘region-wise service interruption’ notice online that it was ‘hereby advis[ing] that the DCash platform has experienced an interruption in service that has affected all users. This break in service has been caused by a technical issue and the subsequent necessity for additional upgrades. Therefore, DCash transactions are not being processed at this time.’
‘The ECCB is fully aware of the impact of this service interruption to all of our DCash partners,’ the advisory continued. ‘We are actively and diligently working with our service provider, technical partner and specialists to bring the platform back online. A report has been made and logged of all failed transactions. These transactions will be honoured as soon as full DCash service is restored. You have our assurance that while DCash service has been interrupted, all DCash wallet balances remain secure and unaffected.’
‘Unfortunate… but useful for testing resilience’
DCash was initially launched in Antigua and Barbuda, Grenada, Saint Christopher (St Kitts) and Nevis, and Saint Lucia. The ECCB extended DCash use to St Vincent and the Grenadines four months afterwards, then to Montserrat (a British Overseas Territory) and the Commonwealth of Dominica.
The ECCB plans to launch DCash in the eighth and final island nation, Anguilla, next month. The central bank’s original ambition was to be live across all eight economies by September 2021.
‘Since the DCash pilot launch on 31 March 2021, we have continued our work on building a robust and resilient technology to underpin our digital currency,’ last week’s advisory notice continued. ‘This remains our mission. The current service interruption is unfortunate but is providing a useful opportunity for testing the resilience of our platform ahead of commercial deployment and integration.’
The notice rounded off by stating that the ECCB extended a ‘sincere apology for the inconvenience this disruption has caused our DCash partners and customers’.
The ECCB’s Karina Johnson, project specialist/project manager for DCash, told Global Government Fintech on 18 January that transactions across the DCash platform remained interrupted, but that the authority was “actively preparing for a resumption of full service”.
“Our service provider has identified the technical issue which is at the root of the break in service,” Johnson said. “This created a number of knock-on operational effects resulting in DCash transactions not being completed, but thankfully, we have been undertaking systems upgrades and expect to have full resumption of DCash service before the end of the current week.”
‘Important learning opportunity’
“We will have a complete picture of transactions affected once service is restored,” Johnson explained, adding that transactions that failed to complete have been logged by the platform – and will be honoured when service resumes.
“Since our public launch, our DCash platform, save for the present interruption, has never experienced downtime or unavailability of service to our user-base,” she said. “The current incident is an important learning opportunity for our CBDC and the underlying technical infrastructure.”
DCash was developed in conjunction with a Barbados-based fintech company, Bitt, which is preparing to host a webinar (on 2 February) entitled ‘DCash: Motivations, Challenges and Learnings’ (see below).
The ECCB sees its digital currency’s introduction as helping to increase financial inclusion, competitiveness and resilience across the islands’ economies. Part of the motivation to launch DCash is also an aspiration to cut the use of traditional notes and coins by 50 per cent by 2025.
Citizens and merchants can sign up to use DCash through participating financial institutions or by downloading an app from the Google Play or Apple Store. Unbanked citizens will need to meet ID verification compliance requirements at participating non-bank financial institutions.
Marking DCash’s debut on 31 March 2021, the ECCB described its launch as the ‘climax of over two years of extensive research, consultations, planning, software development, operational training, merchant acquisition, customer service, and marketing achieved through collaboration with the ECCB, Bitt and multiple external stakeholders’.
Another island nation, the Bahamas, was the first country to launch a CDBC, with its ‘Sand Dollar’ becoming the first fully deployed digital version of a fiat currency when it launched almost 18 months ago.
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‘DCash digital currency to aid island’s recovery from volcanic eruption’ – our news story (9 August 2021) on the CBDC becoming available for public use in St Vincent and the Grenadines‘
‘Eastern Caribbean nations roll out blockchain-based digital currency’ – our news story (4 April 2021) on DCash’s launch