At least that’s according to Ben Fung from the Central Bank of Canada and Walter Engert from the Office of the Superintendent of Financial Institutions, both of whom published a paper this week discussing the pros and cons for central banks issuing cryptocurrencies.
Notably, the paper ends on the question of whether it’s worth it for such institutions to offer cash or central bank digital currency (CBDC), should such demand drop deeply enough, though it ties the query to the idea this would need to come at the expense of cash use.
“Is it sufficient for a central bank to supply only reserves to qualified financial institutions? Put differently, is a ‘cashless society’ a sound outcome?”
The paper goes on to explore six different supposed benefits to a central bank for issuing a digital currency, but largely dismisses all but three: payments for consumers, financial inclusion and stability…