Published: 12.04.2022
Article reading time:
2 minutes.
The leadership of the research department of the Bank of Canada (BC) has officially announced that the decision to launch a digital Canadian dollar is being postponed.
SC Financial Technology Director Dinesh Shah said reaching consensus on implementing a government digital currency with other central banks “is not a top priority.”
The decision regarding the digital currency of the Central Bank for individual countries differs due to the difference in payment systems. The head of the research department added that a group of six Central Bank experts was formed at the beginning of 2020 to research state digital currencies:
“Even if there is no consensus, an open exchange of ideas is very valuable.”
Dinesh Shah said that research on the state digital currency began since his appointment in 2014. One of the first tasks was to explain Bitcoin technology to politicians and economists. The catalyst for the study was the decline in cash.
“At the Bank of Canada, the study was initiated not because of the popularity of cryptocurrencies, but rather because of the falling demand for cash. Like many other countries, Canada at the time saw a steady decline in everyday cash use even though the amount of money in the economy was increasing.”
According to. Shah, it is quite early to launch a state digital currency, since the role of blockchain technology and decentralized digital registries underlying the vast majority of cryptocurrencies in the development of any CBDC is not yet clear.
Blockchain technology “is not a given, but it is still on our list of potential opportunities,” the executive said. And he recalled that in the past he showed some skepticism about the launch of the Central Bank’s digital currency for retail payments.
Sun recently launched a joint CBDC study with the Massachusetts Institute of Technology (MIT). It is currently unclear what the results of the studies will be, Shah said. The Sun will partner with the Bank of England and the Federal Reserve Bank of Boston, which are also MIT partners.
Shah’s views echo those of the head of the Swiss Central Bank, Thomas Moser, who called the blockchain technology too primitive to base the issuance of the Central Bank’s digital currency on.
Source: Bits
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