The Bank of Canada is ‘scaling down’ plans for a possible digital loonie – National

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The Bank of Canada is ‘scaling down’ plans for a possible digital loonie – National

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The Bank of Canada doesn’t see a “compelling case” to move forward with plans for a central bank digital currency (CBDC) after years of study, governor Tiff Macklem said Tuesday.

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As part of the Bank of Canada’s mandate to oversee payment and currency frameworks for the country, the central bank since 2020 has been studying what a digital version of the loonie may look like as cryptocurrencies like Bitcoin garnered more mainstream attention.

Any potential decision to implement a digital loonie of some kind would be in the hands of Parliament, not the Bank of Canada.

Governor Tiff Macklem, speaking to the Institute of International Finance and the ********* Bankers Association on Tuesday, said the central bank has built up “an extensive body of knowledge” about what it would take to implement a central bank digital currency in Canada.

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But, for now, the Bank of Canada is shifting away from preparations for such a plan.

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“Recognizing that there is not currently a compelling case to move forward with a CBDC in Canada, the Bank is scaling down its work on a retail central bank digital currency and shifting its focus to broader payments system research and policy development,” Macklem said.

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He added that the Bank of Canada will continue to “monitor” global central bank digital currency developments and reiterated that it “will be ready to ensure Canadians always have a safe and secure supply of public money.”

Briefing notes acquired by the ********* Press from January 2021 revealed officials warned Finance Minister Chrystia Freeland that the issuance of a central bank digital currency would entail “wide-reaching implications for the economy, the financial system” and the Bank of Canada’s operations.

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The Bank of Canada’s public consultations on a possible digital loonie from last year showed the vast majority of Canadians who responded to the survey were opposed to the implementation of a central bank digital currency.

— with files from the ********* Press

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