Cryptocurrencies such as Bitcoin do not pose any significant risk to the financial system or economy, says Bank of Canada Deputy Governor Paul Beaudry.
Speaking to the Ontario Securities Commission, Beaudry said that the Bank of Canada doesn’t think that cryptocurrencies are "developing in a way that creates a systemic type of risk for a financial system." This is because cryptocurrencies are "quite removed from a financial system," he added.
Beaudry also stressed that classic cryptocurrencies such as Bitcoin do not play much of a role in payments, as investors buy digital coins and tokens “mainly to speculate.”
But there are also digital assets such as stablecoins that are backed by assets and fiat currencies, which could potentially play a bigger role in payments, he said. "That’s something we’re also keeping an eye on," Beaudry added.
Canada has emerged as one of the world’s most crypto-friendly countries, becoming one of the first jurisdictions in the world to approve a Bitcoin exchange-traded fund (ETF). Canada has also been a popular spot for global cryptocurrency miners, ranking as the fourth-largest nation in terms of hash rate according to Cambridge Bitcoin Electricity Consumption Index.
