Based on a series of surveys, central bank researchers found that around 5 per cent of Canadians owned bitcoin between 2018 and 2020.
The researchers found that bitcoin owners tend to have a greater knowledge of how bitcoin technology works than non-owners, but score lower on general financial knowledge questions.
The surveys, conducted annually between 2016 and 2020, highlight the risk of investing in the volatile and sparsely regulated asset class.
The Bank of Canada has been tracking the adoption of cryptocurrencies since 2016 to see how they are being used and whether they represent a challenge to the existing money and payments system.
The last survey included in the research paper was conducted in November, 2020, which means that the research misses the run-up in cryptocurrency prices at the end of 2020 and into 2021.
A pair of surveys conducted by KPMG in 2021 and early 2022 found higher levels of cryptocurrency adoption, including among institutional investors.
The Bank of Canada’s research suggests crypto investors need to be aware of the risks that accompany the asset class.
The Bank of Canada is developing a prototype for its own central bank digital currency – a kind of digital cash usable for online payments.
There are two main reasons why central banks may want to develop their own CBDC: a collapse in physical cash use or widespread adoption of cryptocurrencies or other private digital assets, both of which could undercut the central banks’ position at the heart of the payments system and its ability to conduct monetary policy.