Federal documents hint at sweeping economic impact from central bank ‘digital loonie’

OTTAWA –

Internal government documents show Finance Department officials believe there could be broad implications for the economy if the Bank of Canada ever issued its own cryptocurrency.

The Bank of Canada has spent years looking at whether to introduce a digital currency, but so far hasn’t seen an immediate need to issue one.

In one briefing note from last January, officials warned Finance Minister Chrystia Freeland that the issuance of a central bank digital currency would entail “wide-reaching implications for the economy, the financial system” and the Bank of Canada’s operations.

The documents also show the central bank held a series of meetings with federal officials over the course of 2020 to gauge the implications of a “digital loonie” on departments and agencies.

Large swaths of the documents obtained by The Canadian Press under the access-to-information law have been blacked out because the department says they contain sensitive government information.

But what remains suggest some federal concerns about a central bank digital currency, with departments wanting to provide more input before a decision is made.

This report by The Canadian Press was first published Jan. 3, 2022