If you have been keeping up with news on Cryptona, then you definitely know that earlier this fall, Russia announced that it would be launching its own countrywide cryptocurrency! The CryptoRuble. And that is absolutely awesome! Especially hearing this news from Vladimir Putin himself!
Well, guess whose following Russia? Canada!
The Canadian Central Bank is considering Cryptocurrencies.
The Canadian CB released a report, exploring the potential of deploying a Central Bank crypto. The Central Bank Digital Currency: Motivations and Implications, starts off by exploring the underlying technology of the bitcoin cryptocurrency as well as the impacts on traditional financial systems and economic foundations.
Despite Canada not being a cryptocurrency powerhouse, it’s quite the liberal country. Therefore, I wouldn’t be the least bit surprised if they actually do launch a federally backed cryptocurrency. The rest of the CBDC paper spends time discussing the issue if whether or not a government Central Bank should indeed issue a cryptocurrency.
Benefits of a CB Cryptocurrency.
A central bank currency could become an alternative to classical bank notes, checks, credit cards, and annoying online transfers. Additionally, it could provide for more payment contestability. Large volume payments between enterprises, P2P, and banks would become more efficient. Payment contestability would also be drastically improved.
It would also allow users to freely access the Central Banks balance sheet. This would open up doorways for non-banking institutions. Allowing for firms who were far from the cryptocurrency world to actually adopt the technology.
Additionally, such a cryptocurrency would provide for improved government-wide financial stability. Reduce interest rates, and promote an unconventional monetary policy. Oh, and it would probably hinder criminal activity too.
Would crypto enthusiasts buy in?
That’s tough to say, any cryptocurrency fan, and most millennials are naturally skeptical of government bodies. And they would probably be annoyed if they started getting all of their business. But, people must understand that governments aren’t trying to kill all other cryptocurrencies or drive the bitcoin into the ground.
No no, they are simply trying to better understand the technology and see how it can benefit their nations. Here’s what troubles me more though. Does a CB really want everyone to see what it does?
As it stands now, the document outlining the CBDC is simply a recommendation and analysis. It’s nothing official. So, stay tuned for more news from the Canadian government in terms of cryptocurrency adoption efforts.