The first digital coin produced by a central bank will soon be issued in the Euro Zone, according to media reports, with Lithuania set to launch its own digital token – LBCOIN.
Next week the Baltic country, which has been overall friendly to cryptocurrencies, will issue the digital coin as part of a project to trial central bank digital currencies and blockchain technology in everyday use, according to a report from Reuters on Thursday.
In particular, 24 thousand digital tokens, called LBCOINs will go on sale next week, based on blockchain technology. The launch follows on from Facebook releaing the whitepaper for its Libra stablecoin, which has forced central banks to start seriously considering launching their own digital coins.
Commenting on the new currency, Marius Jurgilas, deputy governor of Lithuania’s central bank said to Reuters: “No one in the central bank community was thinking about digital currency seriously before we realized that there is a legitimate threat that someone else will take our space… We need to provide society with what it wants.”
Lithuania’s LBCOIN is similar to CBDCs
According to Jurgilas, LBCOIN is similar to a central bank digital currency (CBDC), which is tradition money in digital form issued and governed by a country’s central bank. The digital tokens will be solid in packs of six for €99 and will come with an attached portrait of one of the 20 people who signed the declaration of independence of Lithuania in 1918.
The central bank of the Baltic country expects users to trade the digital token with orders to build a specific set which can then be exchanged for a credit card-sized physical silver coin with a nominal worth of €19.18. Holders of LBCOINs can exchange the tokens directly with the central bank and on private blockchain networks, according to Reuters.
“At a time when central banks are beginning to change their thinking on digital currency, LBCOIN is probably the most advanced experimental playground to test different reincarnations of the CBDCs,” Jurgilas told the news outlet.