The Bank of Canada has joined forces with the Massachusetts Institute of Technology (MIT) to undertake a 12-month research project on a central bank digital currency (CBDC).
The collaboration will see Canada’s central bank work with the MIT Media Lab’s Digital Currency Initiative (DCI) to explore the potential design of a CBDC using advanced technologies.
The DCI was established “to bring together the brightest minds at MIT and elsewhere to conduct the research necessary to support the development of digital currency and blockchain technology”, according to its website.
The Bank of Canada stated that while “no decision has been made on whether to introduce a CBDC in Canada”, its collaboration with MIT will form part of its wider research and development agenda on digital currencies and fintech.
The focus of the project is on exploring and experimenting with potential technology approaches to determine how a CBDC could work, should one be implemented in Canada.
At the end of the project, the Bank of Canada will provide an update on the findings.
During Open Banking Expo’s Central Bank Digital Currencies virtual Confex earlier this month, speakers discussed how Facebook’s announcement about launching its own cryptocurrency, Libra, back in 2018 marked the point at which central banks started to “take seriously” the idea of CBDCs.
To register for Open Banking Expo’s Central Bank Digital Currencies virtual Confex and watch all the sessions back, click here.