Stephen Harper, who served as Canada’s prime minister for nine years, said there may be a place for Bitcoin and the central bank’s digital currency as part of a basket of reserve currencies to replace the dollar.
In an interview with Jay Martin of investment services Cambridge House at the Vancouver Resource Investment Conference today, Harper said the possibility of replacing the US dollar could only come from large currencies such as the euro or the Chinese yuan. He expressed doubts any of them would be a viable alternative currency given the long-term uncertainty over the value of the Euro and the “arbitrary actions” that the Chinese government would take regarding the value of the yuan:
“It’s hard to see what the alternative is to the US dollar as the world’s main reserve currency. Besides gold, Bitcoin, many things […] I think you’ll see the number of things people use as reserves grow, but US dollars will still make up the bulk of it. ”
The former prime minister added that he thinks central bank digital currencies, or CBDCs, are to some degree “inevitable” but likely to be subject to monetary policy around the world. Harper said he was concerned about the central bank becoming a “kind of general banker” rather than a mere financial monitor, something that could affect the launch of any CBDC:
“Ultimately, if you have a digital currency and the central bank’s goal is to control inflation and create a currency that’s stable and at an affordable price, then digital currencies are just kind of an evolution of the market,” said Harper. “But if it’s part of a series of what I consider a wild experiment about the role of the central bank, then it worries me a lot. “
Harper served as prime minister of Canada from 2006 to 2015. Crypto and blockchain adoption in the country has grown significantly since his departure, with Canada having its first regulated crypto exchange in September. According to Timothy Lane, deputy governor of the Bank of Canada, the bank is also engaged in CBDC development.