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Canadians Show Less Interest in CBDC, Brazilian CBDC Set to Launch Digital Currency in 2024

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Bank of Canada reveals that most Canadians show less interest in Central Bank Digital Currency (CBDC) due to the country’s effective banking and financial services.

Brazilian central bank plans to launch its digital currency, DREX, in 2024 as it envisioned to enhance its financial services.

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Canadians Have Little Interest in Using CBDC

Bank of Canada, on August 8, 2023, announced via the X platform that 92% of merchants in Canada intend to adopt something other than digital currency.

Furthermore, the bank released a report after the survey, which was carried out to understand how CBDC would impact its citizens if cash were removed.

According to the paper, released on August 10, most Canadians feel comfortable with the available bank services within the country, like creating bank accounts or issuing credit or debit cards.

In the report, 98% of adults in Canada own a bank account, 87% have bank credit cards, and 90% of urban and rural dwellers have access to high-grade internet.

It was discovered that digital currency replacing cash will frustrate cash-dependent Canadians as making common payments will seem difficult, and tech-averse citizens will have fewer payment alternatives.

Moreover, the less interest Canadians have shown in CBDC shows could demoralize business owners and prevent them from adopting CBDC.

However, this would make the digital currency have an insignificant impact on the nation’s economy.

Bank of Canada further stated in the paper that it prefers enhancing internet access, making low-cost bank accounts available, and improving businesses’ collaboration with remote regions as options for areas that are underbanked and continue supplying cash.

Cash is Still a Necessity

According to the paper, the bank also pointed out that cash is still relevant to meet offline emergencies, considering the impact of digital currency in huge power outages or dangerous weather conditions.

It insinuated that in such times, cash is the only means of payment for offline transactions to meet individuals’ needs.

However, the Bank of Canada acknowledged that more Canadians could be interested in CBDC for various reasons.

Furthermore, it said it will continue issuing cash; hence there is demand for it, and ready to issue CBDC when there is extensive demand for it in foreign transactions.

Banco Central do Brazil Names Its Digital Currency DREX

The central bank of Brazil announced on August 7, 2023, that it will launch the country’s central bank digital currency, named DREX, in 2024.

This currency will utilize distributed ledger technology (DLT) to finalize wholesale interbank trades, and retail access will be established on tokenized bank deposits.

The project coordinator, Fabio Araujo, shared that Brazilians have shown readiness for CBDC following their extensive engagement with digital payment services through some financial firms like Pix, launched in 2021.

Moreover, Araujo, a staff of the Brazilian bank, noted that the central bank aims to increase the accessibility of financial products to the public.

It is expected that DREX will foster insurance, investment, and lending services when launched.

 

 

 

 

 

 

 

 

 

 

 

 

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