Bank of Canada Mulls Launching Its Own Digital Currency

Canada’s central bank, the Bank of Canada, has been researching the benefits of launching its own cryptocurrency.

The Financial Post has obtained an internal presentation prepared for Governor Stephen Poloz and the bank’s board of directors and apparently, the researchers found significant upside for the bank should it choose to go the digital currency route.

The presentation, titled “Central Bank Money: The Next Generation,” was presented as a two-year project and listed over a dozen benefits a proprietary currency would have for the central bank.

A digital currency, it said, would provide “all the benefits” of a central bank-backed asset as well as “all the convenience and security of wireless, electronic payments.”

“An additional payment method could make the payment system more robust,” the presentation also noted.

Remarkably, it only listed one downside: that digital currencies could present “a risk to stable, low-cost funding for (banks) (deposits).”

It suggests a digital currency could come with the option to pay interest on balances, and the ability to collect more information on Canadians than is possible when people use cash. “Personal details not shared with payee, but could be shared with police or tax authorities,” reads the presentation.

“We need to innovate to stay in the game,” the presentation read.

The hypothetical currency, it said, would initially coexist with coins and paper money, and then eventually replace them completely.

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