Bank of Canada releases discussion paper on merits and risks of digital currency
CALGARY — The Bank of Canada is considering the merits and risks of digital currencies as interest in cryptocurrencies like Bitcoin reaches a fevered pitch.
In a research paper released by the central bank Thursday, report authors Walter Engert and Ben Fung said there are merits to creating a central bank digital currency as society starts to move away from cash, and the bank’s potential to reap profits off issuing that cash could be threatened.
The staff discussion paper, which doesn’t necessarily reflect the views of the bank, said a central bank digital currency (CBDC) could become a cheaper alternative to debit and credit cards and other forms of payment, making it easier for competition to emerge in the retail and large-value payment sectors.
“With no transaction fees charged by the central bank, the benchmark CBDC would probably be less expensive for merchants than cash and credit cards.”