Bank of Canada members published an article discussing the pros and cons of the central bank issuing cryptocurrencies

nBankruptcy comment: Some of the central bank intends to issue encrypted currency news one after another, but for many people, whether the central bank to issue encrypted currency is good or bad is still worth exploring. At the moment, members of the Bank of Canada have written an article on this topic for associates of the Joint Financial Institutions OIOS to analyze the pros and cons of such behavior. Although they state that the article’s view does not represent the Bank of Canada’s position, it still has some guiding significance.n
nTranslation: Inan
The central bank may benefit by issuing encrypted versions of the legal currency, but these benefits may vary, depending on the economy in which the central bank is acting – whether developed or developing.n
At least Ben Fung of the Bank of Canada and Walter Engert of the Canadian Financial Authority Oversight Agency say so. Last week they jointly published an article exploring the advantages and disadvantages of the central bank issuing cryptocurrencies.n
It is noteworthy that the article concludes with a question as to whether the need for such a central bank digital cash supply (CBDC), such as the central bank, is worth or not, and whether such demand will plummet. It also questions this question as ” The use of cash for the price “idea linked.n
Article wrote:n
n”Is it enough for the central bank to provide only qualified financial institutions? In other words, is the cashless society a good result?”n
nThis article also explores the six possible benefits that the central bank can issue in issuing digital currencies, but only three deserve attention: consumer payments, financial inclusion and stability.n
In consumer payments, the authors wrote: “CBDC will facilitate some friction-barred deals.” In particular, it will reduce the drag on online payments and attract smaller businesses to serve via the Internet. In some economies, CBDC can also reduce the cost of consumer retail payments.n
The authors believe that financial inclusion benefits only the developing economies and cites other existing solutions around the world (such as the M-PESA system in Africa), which, like digital money, appear to be shrinking financial services gap.n
They wrote:n
n”In most advanced economies, including Canada, financial inclusion can not be a convincing part of CBDC.”n
nFinally, the article gives a less definitive conclusion on the role of financial stability.n
On the one hand, the author wrote:n
n”The financial systems in Canada and some other countries have developed banks that are going to make liquidity and maturity transitions and are paying for the core operations of the system, which, as we all know, may be unstable in some cases, In severe cases, the stock of internal currencies may contract, adversely affecting the economy negative externalities. “n
nDigital money will provide consumers with a way to store their worth without any risk. On the other hand, the easy abandonment of bank deposits and the switch to cryptocurrencies can speed up economic turmoil.n
However, this article only illustrates the views of the two authors and does not necessarily represent the views of the Bank of Canada.n

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