Bitcoin and crypto has faced a lot of regulatory scrutiny and criticism from several countries and top individuals. However, many are still considering to launch their own digital currency.
Particularly, the rumor has it that the Bank of Canada plans to make a foray into cryptocurrency.
According to a report, the bank is looking into both the advantages and the challenges that may arise from creating its own cryptocurrency. Many schools of thought believe that creating a central bank digital currency (CBDC) will help effectively tackle the perceived threats of cryptocurrencies. Canada is allegedly stating this as the reason for developing its digital currencies.
“Central Bank Money: The next generation” was created after two long years of research into cryptocurrency. The document was presented to Stephen Poloz in 2018. He is the Governor of the Bank of Canada. The document pointed out that launching a CBDC will help the government to track important information about its citizens. Information that would be indispensable to authorities like the police or tax officials when necessary.
Author of the document, Stephen Murchison had this to say: “We need to innovate to stay in the game. […] the CBDC would have all the benefits [of a central bank-backed asset,] and all the convenience and security of wireless, electronic payments”.
Spokesperson for the Bank, Josianne Ménard however disclosed that the bank has not reached a decision about launching a crypto.
It is, however, important to note that last year, Canada loosened up on its AML regulations. This was as a result of responses from service providers and several crypto exchanges.
Could Bitcoin be nearing its end?
Several countries are springing up with ideas about creating a CBDC. The question that comes to mind is what will happen to Bitcoin? Bitcoin, as well as other cryptos, have had a really rocky road to their popularity. Popular Economist, Nouriel Roubini, once referred to Bitcoin as the “mother of all scams“. He further advised central banks to issue their own crypto to clampdown on Bitcoin and other crypto.
He said: “If a CBDC were to be issued, it would immediately displace cryptocurrencies, which are not scalable, cheap, secure, or actually decentralised.”
Unfortunately, almost a year later, most of his predictions are turning up to be true.
Personally, I think it is quite hypocritical to criticize and ostracize crypto like so many countries are doing. And then hatch plans to create a CBDC.
What do you think about Canada’s alleged crypto? Do you think Bitcoin is winning or going extinct? I would really love to hear from you.