Bank of Canada sees no strong case for a digital dollar — for now

The Bank of Canada doesn’t see a strong motive for issuing a central financial institution digital foreign money, or CBDC for the time being.

Timothy Lane, the Bank of Canada’s deputy governor and head of analysis on the financial institution’s fintech and crypto division, spoke on CBDC points at a Wednesday panel, Reuters reports.

According to the official, the Canadian central financial institution is now targeted on CBDC implementations in additional concrete phrases, excited about the way it would possibly work and look. However, the Bank of Canada has not discovered any strong case for issuing a CBDC, Lane mentioned:

“In terms of where we are with the project, we don’t currently see a strong case for issuing it, but the world is progressing very rapidly and probably even more so in the wake of the pandemic.”

Not solely does the Bank of Canada not see a strong case for issuing a CBDC but in addition it has outlined a quantity of dangers associated to a state digital foreign money beforehand. In October 2020, the bank issued a report on CBDC-associated risks, paying particular consideration to threats arising from CBDC storage points and competitors between crypto exchanges and banks in phrases of attracting customers.

Last December, Lane mentioned that the worldwide coronavirus pandemic could force Canada to launch a CBDC sooner than initially anticipated. “I would say that in the last nine months we’ve seen developments that look like they’re in the direction of some of those things coming to pass sooner than expected,” he mentioned in late 2020.

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