Tiff Macklem, Governor of the Bank of Canada, underlined that Bitcoin cannot be classed as a currency since it lacks transactional qualities.
According to CTV News, the Governor, who has maintained a dubious position on the commodity, says that despite nations such as El Salvador adopting Bitcoin as legal cash, the asset is not utilized in everyday transactions.
Simultaneously, more businesses continue to accept Bitcoin as a payment method. Macklem thinks the present system of cash will continue longer but admits that the epidemic has expedited the migration to digital commerce.
“Let me be clear: Bitcoin is not a kind of electronic money. Individuals do not utilize Bitcoin to make purchases… We have banknotes and will continue to have banknotes for the duration of my Governorship; they are not going away. Simultaneously, we recognize that our economy is growing increasingly digital, and the epidemic has expedited this trend,” Macklem remarked.
Macklem previously said that despite the existence of several cryptocurrencies, none qualify as currencies, instead referring to them as crypto assets. He argued that further international collaboration is necessary to create a streamlined cryptocurrency industry capable of supporting large-scale transactions.
Macklem has also said that the world monetary-financial system is undergoing adjustments. According to the Governor, the digital transformation was sparked mostly by the coronavirus outbreak.
Additionally, Macklem claimed that the country’s finance minister will consider a prospective digital currency issued by the Canadian central bank. Nonetheless, the organization has engaged in research to determine the feasibility of developing a CBDC.
In July, the Bank of Canada produced a study outlining the primary reasons for establishing a CBDC. According to the paper, a digital currency is critical in the face of rising competition among payment service providers and technological innovation.
Additionally, the research identified decreased cash usage and the CBDC’s role in reacting to the rise of alternative digital currencies as important motivators for the proposed transition.
The bank confirmed in October that it would not create a CBDC anytime soon, although that decision may alter if physical cash use drops.
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