The Reserve Bank won’t be issuing an official digital currency any time soon.
In a speech, Deputy Governor Geoff Bascand says: “Currently, it is still too early to determine whether a digital currency should be issued.”
There were “considerable risks” for a digital currency to undermine financial stability, he says.
“A digital currency is easier and faster to distribute around the country than banknotes because it doesn’t need to be transported,” he says.
A downside of a digital currency would be new infrastructure costs, he says.
On whether a digital currency could improve payment systems, Bascand says it depends on how the currency is designed.
“Digital currencies with central control can improve efficiency, but potentially at the expense of reduced resilience. At this time, a blockchain-type of official digital currency would reduce the efficiency of the payments system.”
First published 3 July, 2018
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