Timothy Lane of the Central Bank of Canada believes that banks should have their CBDCs ready if Libra is blocked

Timothy Lane says the central bank is developing a CBDC at „a good pace“.

According to an October 15 report by The Canadian Press, Timothy Lane, deputy governor of the Bank of Canada, or BoC, said central banks should have their own digital currency ready in case regulators block the Facebook Pound token. He also pointed out that this asset is important as a possible solution to the economic realities due to the COVID-19.

Lane spoke at an online panel discussion organised by the Central Bank Payments Conference, indicating that the Bank of Canada has been developing a digital central bank currency, or CBDC, at „a good pace“. He said the bank would need to consult on what Canadians expected from a Crypto Legacy, but added that Facebook’s efforts to introduce Libra could help improve cross-border payments. In addition, he said it could help the unbanked and under-banked become part of the global economy.

„That is the heart of the question: is the answer Libra or is it something that central banks do? „If we say, well, it should be (a CBDC and) not Libra, then we have to have something ready so that, if a decision is made, the central bank’s digital currency is the way to go, we are really ready to launch it.

The Lieutenant Governor’s comments are a change from those of February before the pandemic, when he stated that „there was no convincing case“ for the bank to create a CBDC. Canada’s central bank also recently released a report calling CBDCs „risky“, given the competition between crypto-currency exchanges and banks, and how digital currency is used for transactions.

Global regulators, including the G20’s financial watchdog, the Financial Stability Board or FSB, recently published regulatory recommendations opposing global stablecoins such as the Pound. The group stated that such stable currencies could become „systemically important“ in all jurisdictions, undermining the ability of governments to conduct monetary and investment policies within their borders.

Cointelegraph reported on October 12 that seven G20 members representing the world’s largest economies said they would initially oppose the launch of global stable currency projects, which would include Libra, pending adequate regulatory oversight. The group of seven has expressed concern about how to ensure that digital assets comply with anti-money laundering laws, consumer protection rules and other regulatory issues.

„The progression here is not to disrupt the system or compete with it, but to increase the payment option for consumers and to complete the system,“ said Libra Association policy director Julien Le Goc, in the same online panel as Lane.