Peter MacKenzie

Economist @CDHoweInstitute

[Web3 Toronto (Web3TO) @Web3To]

The Great Canadian Stablecoin Debate!

Douglas Heintzman @DHeintzman , Kesem Frank, Ali Abou Daya @aliaboudaya , and @PeterMackenzie2 delivered an insightful discussion on the evolution of stablecoins, regulatory considerations, and their growing role in the future of payments and financial infrastructure.

[Web3 Toronto (Web3TO) @Web3To]

We’re excited to welcome Peter MacKenzie, PhD @PeterMackenzie2 to Digital Asset Summit Canada on Friday, May 29 🇨🇦

Peter is a Senior Policy Analyst at the C.D. Howe Institute, leading research on financial regulation, digital payments, and stablecoin policy ⚡️

📍 Downtown Toronto Financial District
🗓 Friday, May 29
🎟 30% off tickets with code DASCANADA30
Get tickets now: https://t.co/YOI65cHL8B

[C.D. Howe Institute @CDHoweInstitute]

Canada has the highest household debt in the G7 – and rising insolvencies – but as Peter MacKenzie told the House of Commons Standing Committee on Finance, this isn’t a systemic crisis.

Learn more about Canada’s public debt challenge in a new report here: https://t.co/IrUbORFc9G

[Andrew Coyne 🇺🇦🇮🇱🇬🇪🇲🇩 @acoyne]

Why Canada needs a digital dollar - The Globe and Mail
https://t.co/4xDfwJZfv7

[Report on Business @globebusiness]

Why Canada needs a digital dollar https://t.co/QvBF8n1oWj

[Peter MacKenzie @PeterMackenzie2]

https://t.co/Dj65A0tO2R

[Peter MacKenzie @PeterMackenzie2]

New op-ed today in the @globeandmail with Mark Zelmer: Why Canada needs a digital dollar.

The US is exporting USD digital payment rails. Without our own, Canadian digital finance could run on rails Canada does not own, in a currency it does not issue.

[Peter MacKenzie @PeterMackenzie2]

New Op-ed in the financial post yesterday:
The Prime Minister called the decade-high FDI inflow a sign of investor confidence, but there's a problem with that story. Nearly half of FDI came through mergers and acquisitions, not new capital.
You can’t build productivity on that

[Financial Post @financialpost]

Opinion: Don’t let the foreign investment numbers fool you https://t.co/8pwrcXmCq8

[National Post @nationalpost]

From our partners @financialpost:

Opinion: Don’t let the foreign investment numbers fool you

https://t.co/eTouLNEPEK

[Web3 Toronto (Web3TO) @Web3To]

Stablecoins

Stablecoins are rapidly becoming a core piece of global financial infrastructure – how is Canada doing in this new race?

Speakers:
Kevin Zhang (CEO, Loon – CADC)@kevinzhangTO
Peter MacKenzie, PhD (@CDHoweInstitute ) @PeterMackenzie2
Thomas You (Maverix Private Equity)@MaverixPe

[Kevin Zhang @kevinzhangTO]

Had a great time on a panel with Thomas You of Maverix Private Equity and @PeterMackenzie2 of C.D. Howe.

Main takeaways from this conversation was yield distribution should be enabled and the reasons not to allow yield are overblown. Banks that rely on this “cheap deposit” need to rethink their business model as it is overall financially predatory. If banks can’t make lending and borrowing models work with market rates, they shouldn’t be able to guard their cheap deposits.

Another major point of conversation in all my discussion with peers is the unclear regulatory framework in Canada for stablecoins. Canada keeps finding ways to block itself from growing and innovating. Stablecoin regulation is a prime example of how we can’t get out of our own way. We should be encouraging stablecoin adoption and finding meaningful ways to incorporate it in our economy, not finding reasons to categorize it as restrictive instruments that have high barriers to entry for all participants. Let us unite and demonstrate that we as a country CAN remove the red tape that have burdened us for so long. Lets make Canada a place where people want to build, grow and innovate.

[Web3 Toronto (Web3TO) @Web3To]

• Allen Lau ( Co-Founder, Two Small Fish Ventures)
• Tre Upshaw ( Founder, Polysights)
• Jon Lourie (CEO, Polyfactual)
• Peter MacKenzie, PhD ( C.D. Howe Institute)
• Jorrin Bruns (Algorand Foundation)
@allenlau @Polysights @basedlourie @PeterMackenzie2 @JorrinB

[Peter MacKenzie @PeterMackenzie2]

@casey_joe @YaelOss @EconWithNick @CDHoweInstitute Regulation is exactly why notes traded at par in Canada. The Bank Act created national branching and standardized note issuance. US states banning branching was also regulation. You’re describing a regulatory design problem, not a regulation problem

[Peter MacKenzie @PeterMackenzie2]

@casey_joe @YaelOss @EconWithNick @CDHoweInstitute The US had a common unit of account but no national currency during the free banking era. Canada’s Bank Act created the national framework that made notes interchangeable.

[Peter MacKenzie @PeterMackenzie2]

@EconWithNick @CDHoweInstitute @GeorgeSelgin No. Central bank necessary to prevent monetary fragmentation and provide liquidity lines in times of economic stress. Also national currency necessary for monetary policy transmission.

[Peter MacKenzie @PeterMackenzie2]

@EconWithNick @CDHoweInstitute @GeorgeSelgin We're not proposing a monetary monopoly. Stablecoins remain privately issued. A wholesale CBDC is settlement infrastructure, not a replacement for private money. A retail CBDC would still be useful but not 100% necessary

[Peter MacKenzie @PeterMackenzie2]

@casey_joe @YaelOss @EconWithNick @CDHoweInstitute Canadian bank notes traded at par because they were denominated in a common national unit, issued by nationally chartered banks under the Bank Act, and backed by institutions that could branch nationally.

[Peter MacKenzie @PeterMackenzie2]

@EconWithNick @CDHoweInstitute @GeorgeSelgin No contradiction. The article concedes technology solves the informational problem, then explains what it doesn't solve: settlement risk, liquidity fragmentation, and de-pegging risk. That's the next sentence. And you still haven't addressed how monetary policy transmits. 1/2

[Peter MacKenzie @PeterMackenzie2]

@EconWithNick @CDHoweInstitute @GeorgeSelgin Direct quote from article: "Modern technology would reduce the informational problem: real-time exchange rates are trivial to compute."
If people transact in competing private currencies, how does central bank monetary policy transmit?

[Peter MacKenzie @PeterMackenzie2]

@EconWithNick @CDHoweInstitute @GeorgeSelgin Well there's the disagreement. The historical record is pretty clear that currency fragmentation imposes real costs on trade and settlement. Our proposal ensures stablecoins remain privately issued while providing the common infrastructure to keep a dollar worth a dollar.