June 28, 2022

The Queens County Citizen

Complete Canadian News World

“Significant implications” if Bank of Canada issues its own cryptocurrency

Bank of Canada maintains its key rate despite inflation

The Bank of Canada has spent years thinking about whether or not to introduce digital currency, but so far there does not seem to be a need to do so.

In a briefing last January, officials warned Finance Minister Christiana Freeland that the central bank would have to issue digital currency. Far-reaching consequences for the economy, the economy And Bank of Canada operations.

The documents show that in 2020, the central bank held a series of meetings with federal officials to assess its implications. Digital Looney On Ministries and Agencies.

A large number of documents obtained by the Canadian press under the Freedom of Information Act have been amended because they contain sensitive government information, the department said.

But what remains is that there is some federal concern over the digital currency, with the central bank and departments wanting to comment further before making a decision.

Bank of Canada has stepped up its work on the digital currency, reflecting the efforts of its rivals in other countries as the COVID-19 pandemic accelerates the transition to a digital economy.

The Bank plans to issue digital currency only if the use of banknotes for transactions is reduced and one or more private cryptocurrencies, such as Bitcoin, are widely used in Canada.

A Bitcoin ATM.

Photo: Radio-Canada

The government and the central bank have paid more attention to low volatility in value and stable cryptocurrencies associated with cash and government securities.

Jeremy Chronic, associate director of research at the CD Howe Institute, said that the use of private cryptocurrencies linked to the US dollar in Canada would undermine the Bank of Canada’s ability to manage monetary policy for national interests.

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He said the bank should encourage private cryptocurrencies to use the Canadian dollar.

The government can repeal this matter in a second. The government can tell you that you can not trade in Canada, forget itSaid Jeremy Chronik, a recent co-author on the merits of the Bank of Canada’s digital currency system.

I do not think they want it because there are benefits to private cryptocurrency that people like, but we also want the public to continue to perform well. To do this, I trust the central bank digital currency.

Central Bank research suggests that the likelihood of people using bitcoin is related to its prevalence – the more people adopt it, the more likely it is that others will follow suit – as well as consumer optimism about the future of bitcoin.

A document released in November found that bitcoin acceptance in Canada was five percent lower. The authors suggest that young Canadians may use bitcoin because it is easier for them to buy digital currency than to open an official bank account.

The Bank of Canada does not have the legislative power of Parliament to deliver digital currency, it can only design it.

Vigilant governments

The Ministry of Finance has reviewed the Central Bank’s law on digital currency, but no other country has been included in the email since March. Deliberately changed the law To empower someone.

Also in Sweden, The Central Bank is widely regarded as at the forefront of the movement towards digital currency in developed economiesThe government is awaiting a report by the end of next year on whether the central bank has the authority to issue such currency.

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How quickly Canadian authorities act depends on how quickly the major stable cryptocurrencies are implemented., Said Jeremy Chronic. He specifically highlighted the stable cryptocurrency that Facebook predicts, as users of the social media giant can easily adopt it.

I want them to move forward, but governments are very slow until they come., He added.