Canada moves forward with CBDC after denying plans

The Bank of Canada appears to be moving towards developing a central bank digital currency (CBDC) despite previously claiming it had no plans to do so.

A digital currency issued and managed by a central bank is known as a CBDC. The Bank of Canada, for instance, could issue digital Canadian dollars — though critics point out that unlike cash, this digital currency could remain under the BoC’s control.

In August the BoC declared that a CBDC would be “unnecessary” and “not feasible” unless there was overwhelming demand from Canadian taxpayers.

But despite there still being a lack of demand, the BoC in December filed for a stake ownership of every “digital dollar” developed in Canada, according to Blacklock’s Reporter. In two separate filings on December 13^th and December 19^th, the central bank invoked the country’s Trademarks Act and declared ownership of the phrases “digital dollar,” “digital Canadian dollar,” and “central bank digital currency” in both English and French. No reason was provided.

Under Section 9 of the Act, any “public authority” controlled by the Canadian government — such as the BoC — can claim exclusive rights to common phrases “used in conjunction with their public actions, services, and wares.” 

“A digital currency will allow the Bank of Canada — a government organization — to know the details of all our transactions,” MP Maxime Bernier told Rebel News. “Whether or not the central bank is serious about protecting our privacy, management, and the Government of Canada will have all this centralized information at their disposal if they want to use it.” 

“Can we trust them after [Finance Minister Chrsytia] Freeland froze bank accounts during the Freedom Convoy? After they printed hundreds of billions to fund Trudeau’s gigantic deficits?” he added. “No!”

Federal Reserve Chairman Jerome Powell confirmed in 2022 that CBDCs will be “identity verified, so [CBDC] would not be anonymous.”

But even more than the lack of anonymity, taxpayers have expressed concern over programmability in CBDC, which allows the central bank to dictate where and how the currency is spent. Media operatives have dismissed programmability as a “conspiracy theory” despite open admissions by experts.

In April, for example, IMF Deputy Managing Director Bo Li expressed hope that programmability will be a feature of CBDCs.

“The third way we think CBDC can improve financial inclusion is through what we call programmability,” said Li. “That is, CBDC can allow government agencies and private sector players to program, to create smart contracts, to allow targeted policy functions. For example, welfare payments. For example, consumption coupons. For example, food stamps. By programming CBDC, those monies can be precisely targeted for what kind of people can own and what kind of use this money can be utilized, for example for food.”

At the World Economic Forum (WEF) Summer Davos conference in May, Cornell Professor Eswar Prasad also advocated for programmability but presented a broader scenario.

“If you think about the benefits of digital money, there are huge potential gains. It’s not just about digital forms of physical currency. You can have programmability [like] units of central bank currency with expiry dates,” he said.

“You could have . . . a potentially better — or some people might see it, a darker — world, where the government decides that units of central bank money can be used to purchase some things but not other things that it deems less desirable, like say, ammunition or drugs or pornography or something of the sort. And that is very powerful in terms of the use of a CBDC.”

Brazil has programmed a feature into its digital currency Drex which allows the Central Bank of Brazil to freeze and even withdraw the funds after they are transferred to a taxpayer.

Based on data from the Atlantic Council, thirty-two other countries are in the process of developing CBDCs. Twenty-one countries have started conducting pilot tests for their digital currencies, while forty-six are still in the research stage. Eleven nations have already embraced CBDCs, including Nigeria, the Bahamas, Jamaica, and the Eastern Caribbean nations.