MIT And Bank Of Canada Will Start A Joint Research On CBDCs

The MIT and Bank of Canada will start joint research on CBDCs which will be going on for twelve months so let’s read more today in our latest cryptocurrency news.

Canada’s central bank collaborated with the Massachusetts Institute of Technology to launch the twelve-month project on central bank digital currencies and the study will inform the financial institution about the product’s merits and implementation in the monetary networks. According to the recent announcement, MIT and the Bank of Canada will be joining the many countries which started exploring CBDCs. The bank partnered with MIT on a one-year research project in order to explore how advanced technologies can affect the design of a CBDC.

The initaitive is a part of the bank’s broader development agenda on crypto and fintech and the institution said the experiment will follow how the CBDC will interact with the rest of the financial system. However, whether a CBDC will be launched in Canada or this is only a project and research, remains unknown. The central bank informed that it will provide even more details on the outcome at the end of the experiment. The CBDCs are the digital form of a country’s fiat currency and unlike the decentralized nature of private digital assets, it is controlled by the authorities.

It is no wonder that the politicians argued that this financial product will be a better option than crypto. This was the case with the IMF Managing director Kristalina Georgieva who suggested that a prudently designed CBDC will be safer than bitcoin and other altcoins as they are inherently volatile. India’s PM Narendra Modi is also interested in the product and he believes it can enhance the digital economy in the years to come.

Canada is not the only nation to conduct such a trial on CBDCs. Recently we saw the Bank of Kenya release a discussion paper to examine what the general public thinks on the matter. The locals are also able to analyze the ups and downs of such products. At the end of 2021, the Bank of Korea also started a testing phase of its CBDC and the institution announced that the project is in the second phase.