Stephen Harper, who served as Canada’s prime minister for nine years, says this may be the right place for central bank bitcoin and digital currencies as part of a reserve currency basket to replace the dollar.
In an interview with Cambridge House Investment Services, Jay Martin today at the Vancouver Resource Investment Conference, Harper said that the ability to replace the US dollar can only come from a major currency like the euro or the Chinese yuan. He asked whether one would be a viable alternative currency, given the long-term uncertainty over the value of the euro and the “arbitrary measures” that the Chinese government would take regarding the value of the yuan:
“It is hard to imagine an alternative to the US dollar as the largest reserve currency in the world. Besides gold, Bitcoin will be a whole basket of things […] I think you will see how much things people use to increase reserves, but the US dollar will still make up the bulk of it.”
The former prime minister added that he believes central bank digital currencies, or CBDCs, are somewhat “inevitable”, but that they will likely be regulated by monetary policy around the world. Harper said he is concerned that central banks will become a “kind of normal bank” rather than a mere financial controller, which could affect the introduction of any central bank digital currency:
“Finally, if you have a digital currency and the central bank’s goal is to control inflation and create a stable currency and price, the digital currency is merely an evolution in the market,” Harper said. “But if this is part of a series of experiments with a central bank role that I think is crazy, that worries me very much.”
Harper served as Canada’s Prime Minister from 2006 to 2015. The adoption of cryptocurrency and blockchain in the country has expanded dramatically since his departure, and in September Canada received its first regulated cryptocurrency exchange. According to Timothy Lin, deputy governor of the Bank of Canada, the bank is moving forward with the development of central bank currencies.