The central bank of Laos has piloted a digital currency project with a Japanese blockchain firm to grow the digital economy and cashless payment systems in Laos.
Laos expressed interest to develop its own digital currency in the near future as part of its cooperation efforts with Soramitsu, a Japanese financial technology startup in 2021.
The Bank of Lao PDR signed a Memorandum of Understanding on Monday with Soramitsu, as the technology developer has vast experience with creating blockchain and digital cross-border payment systems.
In 2020, Soramitsu assisted Cambodia to develop Bakong, an all-in-one mobile payment and banking app, where digital payments can be made with the click of a finger. And Laos will use a modified version of this system to create and circulate digital currency among consumers via commercial banks.
Laos will also explore the possibility of digital cross-border payments with Cambodia. The two countries hope to make their digital currencies more viable by developing a cross-border payments system together as the latter is not widely available, according to Nikkei Asia.
The central bank of Laos has also issued a notice suspending loans to cryptocurrency businesses from January this year.