Stephen Harper, who served as prime minister of Canada for nine years, says there may be a place for Bitcoin and central bank digital currencies as part of a basket of reserve currencies to replace the dollar.
In an interview with investment service Cambridge House’s Jay Martin at the Vancouver Resource Investment Conference today, Harper said the possibility of the U.S. dollar being replaced could only come from a large currency like the Euro or Chinese yuan. He expressed his doubts either of them would be a viable alternative currency given the long-term uncertainty over the value of the Euro and the “arbitrary measures” the Chinese government would take regarding the value of the yuan:
“It’s hard to see what the alternative is to the U.S. dollar as the world’s major reserve currency. Other than gold, Bitcoin, a whole basket of things […] I think you’ll see the number of things that people use as reserves will expand, but the U.S. dollar will still be the bulk of it.”
The former prime minister added that he thought central bank digital currencies, or CBDCs, were to some degree “inevitable” but would likely be subject to monetary policy around the world. Harper said he was concerned about central banks becoming “kind of a general banker” rather than just a financial monitor, something that could affect the rollout of any CBDC:
“Ultimately, if you have a digital currency and the purpose of the central bank is to control inflation and create a stable currency and priceability, then digital currency is just kind of an evolution of the marketplace,” said Harper. “But if it’s part of a series of what I think are wild experiments as to the role of central banking, then it worries me a lot.”
Harper served as the prime minister of Canada from 2006 until 2015. Crypto and blockchain adoption in the country has expanding significantly since his departure, with Canada getting its first regulated crypto exchange in September. According to Timothy Lane, the deputy governor of the Bank of Canada, the bank is also moving along in its development of a CBDC.
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