During the opening of a seminar on Tuesday on Digital Central Bank Money (DSP), Central Bank Governor Ida Wolden Bache assured that digital central bank money should not be misused for monitoring and control.
'Any digital central bank money should be firmly rooted in democratic institutions with strict built-in rules in relation to the collection and use of data, as we have in a number of other areas, 'Wolden Bache. said at a seminar on Digital Central Bank Money (DSP) on Tuesday.
Governor Wolden Bache of Norges Bank thus addressed one of the critical questions raised by many in the outside world in relation to the eventual introduction of Digital Central Bank money. At the same time, the issues related to privacy, surveillance and control will continue to be a topic of debate in the future.
Tuesday's seminar was jointly organized by Norges Bank and the Directorate of Digitalization. The seminar brought together around 100 participants from the private and public sectors, who also participated in group work after the lectures.
Norges Bank is now in phase 4 of the mapping of any digital central bank money. While previous phases have been characterized by investigations and surveys, Phase 4 is concrete with extensive experimental testing in a safe technical environment. The work takes place in cooperation with other central banks and actors in banking, finance and fintech.
This testing phase points forward to a report to be delivered in the summer of 2023. If Norges Bank recommends that digital central bank money should be introduced, a development project based on a recommended technology will be initiated. Along the way, it becomes necessary to gain political acceptance and grounding.
The central bank governor had two primary justifications for untangling digital central bank money, changes in the payment landscape and being “lead was”. - The payments landscape is rapidly changing, with new digital services being launched on an ongoing basis. A key part of the backdrop, is that cash use is low and falling. Then it is natural to investigate whether it is possible to preserve some of the characteristics of cash, such as contingency, by introducing digital central bank money,” Wolden Bache said.
- The second reason is that we want to be lead var. We need to take into account that some of the changes we are now seeing in the payment area could have far-reaching implications for the entire financial system,” Wolden Bache said.
- Also in the future it should be safe to pay in Norwegian kroner. An overall goal is to promote a secure payment system. The payment system is also important for monetary and financial stability, she said.
Today, the public has access to two types of money: cash, which is issued by the central bank, and bank account money, which is deposited in Norwegian banks. Wolden Bache stressed that it is only the cash that digital central bank money is intended to replace or supplement.
- We believe that the cash can continue to coexist with digital central bank money. Digital central bank money is also not supposed to outperform bank account money. Any digital central bank currency should not significantly impair private operators' ability to provide credit. The purpose must be payment and contingency, not value retention, Wolden Bache said.
Norges Bank is now in phase 4 of the mapping of any digital central bank money. While previous phases have been characterized by investigations and surveys, Phase 4 is concrete with extensive experimental testing in a safe technical environment. The work takes place in cooperation with other central banks and actors in banking, finance and fintech.
- We test out the technologies that we are most curious about. These are largely based on blockchain technology and programmable digital tokens. By being independent of the technologies we use today, these platforms can potentially have an important contingency function.
According to Wolden Bache, the goal is not to replace current tools, but to provide the central bank with new opportunities. - We need to have tools at the ready, if the digital development were to go in a different direction than now, or if the digital development will be even stronger than now, said the central bank governor.
Wolden Bache also stressed the value of public-private collaboration, “We have a long tradition of working together, across institutions, both public and private enterprises. We are far ahead in the digital everyday world, where much has been done, but also a lot remains, said Wolden Bache who wished the seminar participants good luck with the group work.
Although the investigation and testing work is now in full swing, the central bank governor stressed that no final decision has been taken on whether or not to introduce digital central bank money.
'The aim is to provide the broadest possible decision-making base on the day the decision is made, 'Wolden Bache said.
During the opening of a seminar on Tuesday on Digital Central Bank Money (DSP), Central Bank Governor Ida Wolden Bache assured that digital central bank money should not be misused for monitoring and control.
'Any digital central bank money should be firmly rooted in democratic institutions with strict built-in rules in relation to the collection and use of data, as we have in a number of other areas, 'Wolden Bache. said at a seminar on Digital Central Bank Money (DSP) on Tuesday.
Governor Wolden Bache of Norges Bank thus addressed one of the critical questions raised by many in the outside world in relation to the eventual introduction of Digital Central Bank money. At the same time, the issues related to privacy, surveillance and control will continue to be a topic of debate in the future.
Tuesday's seminar was jointly organized by Norges Bank and the Directorate of Digitalization. The seminar brought together around 100 participants from the private and public sectors, who also participated in group work after the lectures.
Norges Bank is now in phase 4 of the mapping of any digital central bank money. While previous phases have been characterized by investigations and surveys, Phase 4 is concrete with extensive experimental testing in a safe technical environment. The work takes place in cooperation with other central banks and actors in banking, finance and fintech.
This testing phase points forward to a report to be delivered in the summer of 2023. If Norges Bank recommends that digital central bank money should be introduced, a development project based on a recommended technology will be initiated. Along the way, it becomes necessary to gain political acceptance and grounding.
The central bank governor had two primary justifications for untangling digital central bank money, changes in the payment landscape and being “lead was”. - The payments landscape is rapidly changing, with new digital services being launched on an ongoing basis. A key part of the backdrop, is that cash use is low and falling. Then it is natural to investigate whether it is possible to preserve some of the characteristics of cash, such as contingency, by introducing digital central bank money,” Wolden Bache said.
- The second reason is that we want to be lead var. We need to take into account that some of the changes we are now seeing in the payment area could have far-reaching implications for the entire financial system,” Wolden Bache said.
- Also in the future it should be safe to pay in Norwegian kroner. An overall goal is to promote a secure payment system. The payment system is also important for monetary and financial stability, she said.
Today, the public has access to two types of money: cash, which is issued by the central bank, and bank account money, which is deposited in Norwegian banks. Wolden Bache stressed that it is only the cash that digital central bank money is intended to replace or supplement.
- We believe that the cash can continue to coexist with digital central bank money. Digital central bank money is also not supposed to outperform bank account money. Any digital central bank currency should not significantly impair private operators' ability to provide credit. The purpose must be payment and contingency, not value retention, Wolden Bache said.
Norges Bank is now in phase 4 of the mapping of any digital central bank money. While previous phases have been characterized by investigations and surveys, Phase 4 is concrete with extensive experimental testing in a safe technical environment. The work takes place in cooperation with other central banks and actors in banking, finance and fintech.
- We test out the technologies that we are most curious about. These are largely based on blockchain technology and programmable digital tokens. By being independent of the technologies we use today, these platforms can potentially have an important contingency function.
According to Wolden Bache, the goal is not to replace current tools, but to provide the central bank with new opportunities. - We need to have tools at the ready, if the digital development were to go in a different direction than now, or if the digital development will be even stronger than now, said the central bank governor.
Wolden Bache also stressed the value of public-private collaboration, “We have a long tradition of working together, across institutions, both public and private enterprises. We are far ahead in the digital everyday world, where much has been done, but also a lot remains, said Wolden Bache who wished the seminar participants good luck with the group work.
Although the investigation and testing work is now in full swing, the central bank governor stressed that no final decision has been taken on whether or not to introduce digital central bank money.
'The aim is to provide the broadest possible decision-making base on the day the decision is made, 'Wolden Bache said.
