O3 - Technological Change; Research and Development; Intellectual Property Rights

• A Retail CBDC Design for Basic Payments: Feasibility Study

  Staff Discussion Paper 2025-9 Sriram Darbha, Cyrus Minwalla, Rakesh Arora, Dinesh Shah

  We outline possible system architectures for an online retail central bank digital currency (CBDC) and identify one well-suited for basic payments. We analyze OpenCBDC 2PC, a representative system, finding such designs to be feasible, although some areas require further investigation. Our framing highlights other promising architectures for a retail CBDC.

  Content Type(s): Staff research, Staff discussion papers Research Topic(s): Central bank research, Digital currencies and fintech JEL Code(s): E, E4, E42, E5, E51, O, O3

• Assessing global potential output growth: April 2025

  Staff Analytical Note 2025-15 Samuel Boulanger, Raheeb Dastagir, Daniel de Munnik, Eshini Ekanayake, Kun Mo, Walter Muiruri, Faiza Noor, Sabreena Obaid, Louis Poirier

  This note presents the annual update of Bank of Canada staff estimates for growth in global potential output. These estimates served as key inputs to the analysis supporting the April 2025 Monetary Policy Report.

  Content Type(s): Staff research, Staff analytical notes Research Topic(s): Potential output, Productivity JEL Code(s): E, E1, E2, F, F0, F1, O, O3, O33, O4

• Tech Reluctance: Fostering Empathy for Canadians Facing Challenges with Digital Systems

  Staff Discussion Paper 2025-2 Sebastian Hernandez, Helena Wang, Badr Omrane, Vera Roberts, David Pereyra

  We find that individuals who require help performing banking tasks or who are reluctant to adopt technology avoid digital payment systems they expect to lack usability. Addressing these issues through standard accessibility practices, live assistance and thoughtful interface design can enhance user interaction and trust.

  Content Type(s): Staff research, Staff discussion papers Research Topic(s): Accessibility, Bank notes, Central bank research, Digital currencies and fintech, Digitalization, Financial services JEL Code(s): A, A1, A14, C, C9, C90, D, D8, D83, O, O3, O33, Y, Y8, Y80

• Privacy-Enhancing Technologies for CBDC Solutions

  Staff Discussion Paper 2025-1 Rakesh Arora, Han Du, Raza Ali Kazmi, Duc-Phong Le

  Privacy-enhancing technologies (PETs) could offer solutions to safeguard end-user privacy and meet rigorous data protection standards for central bank digital currencies. We consider how PETs can transform privacy design in financial systems and the implications of their broader adoption.

  Content Type(s): Staff research, Staff discussion papers Research Topic(s): Central bank research, Digital currencies and fintech, Financial system regulation and policies, Payment clearing and settlement systems JEL Code(s): E, E4, E42, O, O3, O31

• The Consumer Value Proposition for a Hypothetical Digital Canadian Dollar

  Staff Discussion Paper 2024-16 Martine Warren, Bill Laur, Ted Garanzotis, Sebastian Hernandez

  We explore the consumer value proposition of a hypothetical Digital Canadian Dollar, adoption considerations and the users who would benefit most from this potential new payment method. We employ a design-thinking consultation methodology, allowing participants to interact with research prototypes of increasing complexity to reveal user preferences, constraints and adoption influences.

  Content Type(s): Staff research, Staff discussion papers Research Topic(s): Accessibility, Bank notes, Central bank research, Digital currencies and fintech JEL Code(s): C, C9, D, D1, D12, E, E4, E42, E5, E58, O, O3, O33

• Analysis of DeFi Oracles

  Staff Discussion Paper 2024-10 Xun Deng, Sidi Mohamed Beillahi, Cyrus Minwalla, Han Du, Andreas Veneris, Fan Long

  Oracles are constructs used in decentralized finance to price assets relative to each other. However, oracles contain defects that could lead to manipulation attacks. Such attacks exploit pricing models embedded within oracles to defraud creators and users. We automatically verify defects, which if mitigated, improves the security of digital currency.

  Content Type(s): Staff research, Staff discussion papers Research Topic(s): Central bank research, Digital currencies and fintech, Payment clearing and settlement systems JEL Code(s): E, E4, E42, E5, E51, G, G1, G15, O, O3, O31

• The Role of Beliefs in Entering and Exiting the Bitcoin Market

  Staff Working Paper 2024-22 Daniela Balutel, Christopher Henry, Jorge Vásquez, Marcel Voia

  We develop a model that links investors’ decisions to enter or exit the Bitcoin market with their beliefs about the survival of Bitcoin. Empirical testing using Canadian data reveals that beliefs strongly influence both entries and exits, and this impact varies with time and ownership status.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Bank notes, Digital currencies and fintech, Econometric and statistical methods JEL Code(s): D, D8, D83, E, E4, E41, O, O3, O33

• Total factor productivity growth projection for Canada: A sectoral approach

  Staff Analytical Note 2024-12 Dany Brouillette, Tessa Devakos, Raven Wheesk

  We propose a tool that decomposes TFP growth into sectoral contributions. The analysis incorporates three structural factors—digitalization, aging and climate change policies—and measures their contributions. Overall, we expect that aggregate TFP growth will slow down in the 2020s below both its historical average and the average from the 2010s.

  Content Type(s): Staff research, Staff analytical notes Research Topic(s): Climate change, Digitalization, Labour markets, Productivity JEL Code(s): D, D2, D24, J, J1, J11, O, O3, O33, Q, Q5, Q54

• Redefining Financial Inclusion for a Digital Age: Implications for a Central Bank Digital Currency

  Staff Discussion Paper 2023-22 Alexandra Sutton-Lalani, Sebastian Hernandez, John Miedema, Jiamin Dai, Badr Omrane

  We explore quantitative and qualitative information about Canadians who face barriers to making digital payments. We also consider the implications of ongoing digitalization for modern financial inclusion and a potential central bank digital currency.

  Content Type(s): Staff research, Staff discussion papers Research Topic(s): Accessibility, Bank notes, Central bank research, Digital currencies and fintech, Digitalization, Financial services JEL Code(s): A, A1, A14, E, E4, E42, E5, E50, I, I3, I31, O, O3, O33, O5, O51

• Anonymous Credentials: Secret-Free and Quantum-Safe

  Staff Working Paper 2023-50 Raza Ali Kazmi, Cyrus Minwalla

  An anonymous credential mechanism is a set of protocols that allows users to obtain credentials from an organization and demonstrate ownership of these credentials without compromising users’ privacy. In this work, we construct the first secret-free and quantum-safe credential mechanism.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Central bank research, Digital currencies and fintech, Payment clearing and settlement systems JEL Code(s): E, E4, E42, G, G2, G21, O, O3, O31