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The Impact of Potential Retail Central Bank Digital Currency on the Canadian Financial System During a Severe Recession

Staff analytical paper 2026-30 Sofia Priazhkina
This policy note examines how a non-interest-bearing retail central bank digital currency (CBDC) could affect the financial stability of Canada’s systemically important banks during a severe recession. Stress test results show that the banks remain resilient, maintaining key regulatory ratios even under high CBDC demand.

Tokenization: What it is and how to think about it

Tokenization involves representing traditional assets as tokens on a digital platform. This financial innovation has the potential to reshape money and markets, but a common approach for comparing system designs and weighing efficiency gains against risks has yet to be defined. We offer such an approach to improve understanding of this expanding technology and guide policy discussions.
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