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VersaBank plans deposit-based digital currency

VersaBank plans deposit-based digital currency

VersaBank says it will launch its own deposit-based digital currency pegged to the Canadian dollar.

The Ontario-based bank is working with Stablecorp on the VCAD, which it says will be the first digital currency to represent a fiat currency, as well as the first issued by and backed by deposits with a North American bank.

VCAD will be issued by VersaBank to financial intermediary partners in exchange for Canadian dollar deposits with the bank utilising smart contracts. These partners will then offer VCAD directly to individuals and businesses, who can use them for commerce and redeem them for Canadian dollars at any time.

VersaBank says that VCAD will create a significant new low-cost deposit source as it experiences record loan growth.

The partners plan to launch VCAD in the next few months and are also eying VUS and a VEuro.

David Taylor, president, VersaBank, says: "As North America's first bank-issued "stablecoin", VCAD offers consumers and businesses the ability to adopt and leverage the benefits of digital currency and blockchain-based assets without the volatility of traditional currencies, alongside the security of a value-backed asset that the cryptocurrency world has long demanded."

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