World’s top states are embracing crypto on a gradual process but Canada is still keeping itself detached from the adoption of crypto. The deputy governor of the central bank of Canada Timothy Lane more focused on cash instead of cryptocurrency. He doesn’t see a real need to issue its own cryptocurrency because in market place there is no parallel competitor to cash. Canada being an active student of the CBDC concept, central bank digital currency, operated a pilot project on R3’s distributed ledger tech solution Corda.
The regulators weren’t that impressed after the project was live-tested in a cross-border settlement trial with the Monetary Authority of Singapore. Lane thinks, the people of Canada are comfortable with the existing payment ecosystem. Maybe, the dissatisfaction on issuing CBDC came after the project got tested back in May. He thinks the existing payment system to be modernized and fit for purpose.
According to lane, a threat to existing Canadian monetary sovereignty, erosion in competition and change in calculation can take place if cryptocurrency is brought to action. He is taking Libra, which marks the transformative technology, as a great and open challenge indeed. Reportedly, despite this harsh reaction from the global community, the development of the project is underway. The bank of Canada wants to have negotiation with other central banks of U.S., Sweden, Switzerland, Japan, the EU and the Bank of International Settlement to run more experimental works.
They will make a survey over key stakeholders and governments to know about whether people prefer CBDC and if yes then how they do. Lane thinks, Canada will need to have digital cash issued and distributed by an organization that is guided by the interest of the public good when Canadians leave cash or turn to a private cryptocurrency. He said this digital cash will be backed by a central bank’s balance sheet and preserve the value of money. Other central bankers also paid the same view for now.