Canada Shifts Focus Away From Retail CBDC Development

According to CoinDesk, Canada has announced a shift in its focus away from developing a retail central bank digital currency (CBDC). The Bank of Canada stated that while it is scaling down its work on a retail CBDC, it remains prepared to revisit the idea if there is future demand from the public. This decision follows years of research into the feasibility of a digital Canadian dollar. CBC News, Canada's public broadcaster, reported that the Bank of Canada confirmed it is shelving the idea of a digital Canadian dollar for now. The central bank's official statement indicated that it is redirecting its efforts towards broader payments system research and policy development. Despite this shift, the Bank of Canada will continue to monitor global developments in retail CBDCs and publish related research. Additionally, there will be opportunities for Canadians to provide input on the potential for a digital dollar in the future. The Bank of Canada's latest position comes amid ongoing debates over CBDCs, including in the United States, where it has become a topic of discussion in the presidential election. Federal Reserve Chair Jerome Powell has stated that the U.S. is not close to recommending or adopting a CBDC, suggesting that the public need not worry about its immediate implementation. The update from the Bank of Canada follows a staff discussion paper released less than three months ago, which highlighted the potential decline in the relevance of cash and suggested that a properly designed CBDC could help maintain the relevance of retail public money in the economy. At the end of 2023, the Bank received nearly 90,000 responses to a public consultation paper, with many respondents expressing privacy concerns.