Palau, in collaboration with Ripple, launched Palau stable coin “kluk,” using the Ripple Central Bank Digital Currency (CBDC) platform to “holistically manage and customize the entire life cycle of the stablecoin,” including for distribution and transactions.

The pilot project is being tested with 200 government employees and participating merchants.  The test is said to run for three months while the government collects participants’ feedback.

The Palau stablecoin, according to fintech news, will benefit Palau by reducing transaction fees and currency costs while boosting financial inclusion.

In addition, it says it will allow government employees to make Palau stable coin (PSC) to enable retailers and convert PSC to US dollars.  According to the report, the Ministry of Finance will be able to “mint, distribute and process inbound redemptions and destroy PSC and fully control the circulation.

President Whipps said that digitizing Palau’s currency will help to build up the economy and improve financial transactions.

However, Chairman Mark Rudimch of the Committee on Resources, Commerce, Trade, and Development have requested the Office of Public Auditor to conduct an audit of the Palau Stablecoin Pilot Project.

Senator requests that the audit verifies if the pilot project has a legal basis to operate and utilizing government resources without following government procurement rules.

“Can this practice, if allowed under this discretionary “private partnering with government project,” be used on other experimental/ pilot programs for corporate profits such as this alternative payment system?

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