Altcoin News: Bank of Canada Thinking About Issuing Its Own Cryptocurrency
The Bank of Canada is exploring the possibility of launching a national digital currency, according to the local publication The Logic, citing a presentation that came to its disposal under the heading “Central Bank Money: The Next Generation”.
According to the publication of the Central Bank, the national digital currency will have several advantages over the traditional one, including the transfer of transaction data to the tax service and the police. The Logic claims that the Bank of Canada is seriously thinking about issuing such digital currency, as they see existing cryptocurrencies as a “direct threat”.
The estimated digital currency of the central bank will be publicly available and will initially exist in parallel with regular money. In the future, it should become the only form of money.
The presentation was prepared by Stephen Murchison, who serves as Assistant Manager of the Bank of Canada Governor Stephen Poloz. After two years of studying this issue, Murchison came to the conclusion that the digital currency of the central bank will have several advantages over the traditional one.
“We need to innovate to stay in the game,” the presentation reads. A digital currency would provide “all the benefits” of a central bank-backed asset, it says, as well as “all the convenience and security of wireless, electronic payments”.
Highlighting the many advantages of such a currency, Murchison mentions only one drawback:
“The digital currency presents a risk to stable, low-cost funding for bank deposits.”
The decision on the transition from research to practical development in the bank has not yet been made. The Bank of Canada acknowledges that cash is no longer relevant, adding:
“Cryptocurrencies may become a direct threat to our ability to implement monetary policy and lender of last resort (LOLR) role.”
A central bank of Canada published a study with similar findings back in the middle of last year.
Author: Marko Vidrih