CBDC as a cryptographic platform

Announcement dated March 17, 2022

The Bank of Canada is collaborating on a CBDC research project with the MIT Digital Currency Initiative. The agreement supports and builds on the DCI’s ongoing research into CBDC, while also contributing to the Bank of Canada’s wider research agenda into digital currencies and fintech. The work will investigate and experiment with potential CBDC technology designs and approaches, and evaluate key tradeoffs, opportunities, and risks. While no decision has been made on whether or not to introduce a CBDC in Canada, this type of research can help inform wider policy development by contributing important technical ideas and questions. 

As part of OpenCBDC, DCI’s open-source codebase and research initiative, DCI aims to fill this gap by engaging technologists, user researchers, central bankers, private sector leaders, and academics in service of a more accessible, trusted, fair, and resilient economy. We don’t yet know if or in what contexts CBDCs can help improve the broader international monetary system, or how they might be best designed to do so, but we believe engaging in technical research is an important step in answering these questions.

The MIT DCI’s interest in this collaboration with the Bank of Canada stems from a desire to have, as much as possible, a hand in ensuring that neutral, responsible research is being done with this technology before any policy decisions are made. Building and implementing helps us understand the problems and challenges better, putting us in a unique position to help shape a CBDC that emphasizes privacy, user agency, and financial equity.

This research will focus on exploring the technical tradeoffs and parameters of central bank digital currency (CBDC) as a cryptographic platform.

Link to public announcement: Bank of Canada and Massachusetts Institute of Technology announce joint Central Bank Digital Currency collaboration

People:

F. Christopher Calabia, CAMS, MIT Digital Currency Initiative
Sam Stuewe, MIT Digital Currency Initiative
Michael Maurer, MIT Digital Currency Initiative