Coronavirus pandemic could accelerate decision-making on digital currency launch, says Bank of Canada official

Tim Lane, deputy governor of Canada's central bank, said Wednesday that the ongoing coronavirus pandemic may ultimately accelerate the institution's decision-making process on whether to issue a digital currency.

The Bank of Canada has spent years experimenting with a digitized version of the Canadian dollar, making it one of a growing number of central banks that conduct research and development in this area. According to Lane, who spoke during an event on Wednesday: "The pandemic may bring us to a decision point sooner than we had anticipated." His comments were reported by Reuters.

Still, Lane's commentary indicated that a decision to go ahead with a digital Canadian dollar is not a foregone conclusion.

"A digital currency is by no means a foregone conclusion," Lane remarked.

Elsewhere during the event, Lane sharply criticized bitcoin, remarking that "[c]ryptocurrencies such as Bitcoin do not have a plausible claim to become the money of the future."

"The recent spike in their prices looks less like a trend and more like a speculative mania."

He similarly expressed a critical viewpoint toward stablecoins, or digital assets that are tied in some fashion to government-issued currencies like the U.S. dollar.

"If that business model were used as a foundation for the dominant method of payment in the economy, the issuer would gain control over an enormous range of data - bringing with it overwhelming market power," Lane said, according to Reuters. "In effect, a technology company could become the gatekeeper of the entire economy."