The Globe and Mail reports in its Thursday edition that the Bank of Canada is closely monitoring the rise of cryptocurrencies and other digital forms of cash, a deputy governor said Wednesday.
The Globe's Ian McGugan writes that Timothy Lane said that while the BOC is concerned about a scenario where a handful of big tech firms could wind up controlling a large chunk of Canada's payments system, it is not yet convinced that a central bank digital currency is the necessary answer.
He said, "We don't currently see a strong case for issuing [a digital currency], but the world is progressing very rapidly and probably even more so in the wake of the pandemic." One challenge in launching a digital loonie would be finding the right private partners to provide the necessary technical expertise. Another would be striking the a balance between anonymity and privacy.
If the bank were to issue a digital currency, it would have to assure people that big government could not use the new form of money to monitor their private transactions, Mr. Lane said.
On the other hand, a digital loonie could not be entirely anonymous either, given the potential to use it for everything from tax evasion to collecting ransoms.
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