Canada CBDC "Might Be Beneficial": Central Bank

The Bank of Canada has released a staff paper detailing several benefits of CBDC adoption, citing smart contract functionality as a major boon. 

Canada Explores CBDC Benefits 

Canada’s central bank appears to be bullish on CBDCs.

In a staff paper published Tuesday, the Bank of Canada has laid out a positive case for CBDC adoption. 



The authors of the paper outline several potential benefits, such as promoting competition in the financial sector and improving consumer choice. Additionally, the paper explores several ways smart contract functionality can improve money management, stating:

“Smart contracts could enable programmable money by adding certain attributes to it. For example, money could be programmed to gain or lose value over time, or it could be programmed to be used in transactions for only specific goods or services.”

With the addition of “programmable money,” the bank also noted that reliance on costly third parties and intermediaries could be reduced or eliminated, further streamlining the financial system. 


The paper concluded by noting that a CBDC could increase welfare, reduce welfare losses, and advance digital innovation, adding:

“A CBDC might be beneficial and probably necessary to ensure a competitive and vibrant digital economy.”

While the paper takes a positive outlook on CBDCs, it also stated that it would only implement one if it provided a net positive to the economy’s welfare. The paper’s authors considered two potential scenarios where this would be true: If cash was no longer widely used in Canada or because an alternative digital currency was so widely adopted, it threatened the country’s monetary sovereignty. 

Until now, the Canadian central bank’s view on CBDCs has been mixed. The bank previously dismissed the value of digital currencies following Sweden’s trial of an e-krona. However, a 2019 report from the bank also highlighted several economic benefits from issuing a CBDC for public use.


The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.

You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.

See full terms and conditions.

Source: Read Full Article