Cash and Cards Dominance in Canada

A yearly Bank of Canada survey has shed light on Canadians' payment preferences, and the results are striking. In 2022 and 2023, less than 3% of Canadians reported using Bitcoin (BTC) or other cryptocurrencies for everyday payments. This statistic underscores the nation's long-standing affinity for cash and bank cards.

Of the various payment alternatives, e-transfer emerged as the most favored method among Canadians. This method allows money transfers using email addresses or phone numbers, offering a convenient and familiar option.

Cryptocurrencies, on the other hand, remain the least favored payment method. In 2022, only 2.2% of respondents used cryptocurrencies for payments, a figure that slightly increased to 2.5% in 2023.

Reluctance to Embrace a Cashless Future

One of the primary reasons for the slow adoption of cryptocurrency in Canada is the widespread reluctance to go cashless. Over 80% of respondents indicated they do not plan to stop using cash. This trend has remained consistent since 2019, reflecting a deep-rooted preference for traditional payment methods.

"Despite the stagnation in crypto adoption, the Bitcoin (BTC) ATM ecosystem continues to thrive in Canada."

Canada hosts the second-largest network of crypto ATMs globally after the United States. The country is home to 2,941 active Bitcoin ATMs, accounting for 7.7% of the world's total. This indicates a growing infrastructure, even if day-to-day usage remains low.

Financial Innovation for Canada

On the other hand, the Bank of Canada is pushing forward with efforts toward financial innovation. The central bank recently inaugurated a new innovation hub, BIS Toronto Innovation Centre, in collaboration with the Bank of International Settlements (BIS). This new hub will work in Canada, Latin America, and the Caribbean.

Bank of Canada Governor Tiff Macklem emphasized the importance of this partnership in fostering innovation in the region.

He stated, "As the financial sector continues to evolve, we need to innovate in different areas and apply skills that aren't traditionally associated with central banking. By doing so, Canadians can share in the benefits of innovation."

The hub will focus on three of BIS' six priority themes: open finance, next-generation financial market infrastructures, and central bank digital currencies (CBDCs).

This initiative aims to ensure that Canada remains at the forefront of financial innovation, even as the adoption of cryptocurrencies for day-to-day payments lags.