For the research work on the Central Bank Digital Currency (CBDCs), the Bank of Canada established partnership with MIT.
Alongside the adoption of the crypto industry despite huge volatility in the price of crypto assets, blockchain technology adoption and research are going on among the government agencies to bring modernization to the traditional financial system and also bring efficiency in the data processing system. In particular, the majority of the central banks are either doing development on Central Bank Digital Currency (CBDCs) or doing research to figure out whether they will be able to make a better financial system over traditional or not.
On 16 March, the Central Bank of Canada announced that the Bank established a year-long partnership with MIT to do deep research on Central Bank Digital Currency (CBDCs). Under this partnership, MIT’s Digital Currency Initiative (DCI) will do its analysis and research on the adoption and implementation of the CBDCs with the Bank.
“explore how advanced technologies could affect the potential design of a CBDC” and “inform (the bank’s) research effort into CBDC.”
Through the announcement, the Central Bank confirmed that they are not 100% sure about the creation of CBDCs, instead, they can consider and research in advance to figure out the possible ways to use blockchain technology-based digital currency, pegged by the Canadian dollar.
Bank also ensured that it will give its report on this research on CBDCs in the next year of time frame.
Earlier in July of last year, the Bank of Canada published its stance on the CBDC adoption. Through the announcement, the Bank noted that CBDC can be a better option and also may push the competition among the currencies because of the users’ demand to reduce the role of mediators and better options. But at that time the Bank confirmed that they may not adopt it directly because with the CBDC adoption they will look on those situations, where it can give profit in every way.
Don’t miss a thing, sign up for our newsletter