Quote:
Originally Posted by JohnnyB
China has gradually rolled out tests of a CBDC for the last couple of years and payment has been available in Digital Yuan at many stores in cities like Shanghai for the last year. It's still a small portion of the currency (around 0.1%) but is the best case study of a CBDC in action with something like 100 million users.
People in China are already used to ubiquitous payment using digital means, so there is already competition from payment providers like Wechat and Alipay that offer very good and sophisticated user experience. Canada doesn't have that, but in Canada people are so used to paying with credit as opposed to paying with cash that it might be even tougher to get adoption with a digital cash alternative. A sophisticated approach could create a lot of incentives for participating by taking lessons from DeFi while providing the risk assurance of government backing, but I imagine that would be a ways off for Canada to even consider.
Personally, I think it would be great to have a government provided digital wallet with a secure digital currency capable of removing banks as an intermediary, but I'm sure it would face pushback and political pressure from industry if it does remove some of the need for banks.
|
Disintermediating the banks isn't all sunshine and roses though. The banks use the money everyone keeps in their chequing accounts to make loans. I know personally I'm not in favour of most loans being made by the government instead. That's a path for politically favored groups to get all the loans, which is both unfair and bad for the economy. Maybe its fine if you own Volkswagen shares or are an Ontario auto worker, but here in AB I think that would end up hurting us.