Plans for a central bank digital currency (CBDC) in Canada could be accelerated due to the coronavirus pandemic, according to the country\u2019s central bank.<\/p>\n
The Bank of Canada said the global health crisis had hastened the urgency of the development of its state-backed digital currency, which could now come sooner than previously envisaged. However, the bank was keen to point out that it was not yet a \u201cforegone conclusion\u201d that a CBDC would be issued.<\/p>\n
Bank of Canada Deputy Governor Tim Lane was quoted by Reuters saying the bank was analyzing the circumstances that might see it launch a digital currency.<\/p>\n
\u201cFor several years, the Bank of Canada has been analyzing which circumstances might lead Canada to decide to issue a digital currency. The pandemic may bring us to a decision point sooner than we had anticipated…A digital currency is by no means a foregone conclusion.\u201d<\/p>\n
Noting the progress being made in other countries, including China, towards a CBDC, Lane said he could see a scenario where a foreign central bank digital currency could come to be used in Canada.<\/p>\n
\u201cWe can certainly imagine a situation where other central banks would launch a digital currency that could come to be used increasingly in Canada…If that were to happen… that could start to threaten the role of the Canadian dollar.\u201d<\/p>\n
However, he noted that digital currencies such as BTC were not \u201cplausible\u201d as an alternative to fiat for the future.<\/p>\n
\u201cCryptocurrencies such as [BTC] do not have a plausible claim to become the money of the future. The recent spike in their prices looks less like a trend and more like a speculative mania.\u201d<\/p>\n
The comments could suggest the central bank is looking to progress the pace of work on its digital currency, with the prospect of further trials in the near future.<\/p>\n
See also: CoinGeek Live panel, The Future of Banking, Financial Products & Blockchain<\/p>\n