Bank of Canada considering ‘potential merits’ of issuing electronic money

OTTAWA – The Bank of Canada says it’s weighing the possible benefits of issuing electronic money.

Senior deputy governor Carolyn Wilkins says the central bank is evaluating the merits of digital currencies like Bitcoin — even as it monitors e-money’s potential pitfalls.

In prepared remarks for her speech Thursday in Waterloo, Ont., Wilkins says people who use e-money need to be aware of the risks of putting their trust in a lightly regulated currency with limited or no user protection.

She says e-money ranges from options like PayPal and pre-paid credit cards to cryptocurrencies like Bitcoin — which are exchanged through computer transactions without the oversight of a central bank.

Wilkins says the increasingly popular digital currencies are not yet big enough to pose material risk to Canada’s financial stability as a whole — but she notes the Bank of Canada is watching.

She says the Bank of Canada has been working with the federal government to modernize Canada’s oversight of the payment method.

Wilkins says virtual money can be used for criminal activities, such as money laundering and terrorist financing.