ECUADOR announced plans today to create the world’s first government-issued digital currency.

The virtual currency, which Central Bank officials say will start circulating in December, does not yet have a name.

Officials would not disclose technical details of the strictly digital currency, but said the amount created would depend on demand.

Bank deputy director Gustavo Solorzano said the new currency would exist in tandem with the dollar and be backed by “liquid assets.”

It would be geared toward the 2.8 million Ecuadoreans too poor to afford traditional banking.

They will initially be able to use it to make and receive payments using their cellphones, said Mr Solorzano, at minimal cost.

President Rafael Correa said the project’s only problem was that it had taken too long to establish it.

He denied any plan to replace the US dollar, which Ecuador set as its currency in 2000 after a banking crisis.