HOW BANK OF ENGLAND IS EXPLORING CENTRAL BANK DIGITAL CURRENCY

The Bank of England (BoE) published a discussion paper on central bank digital currency (CBDC) in March 2020.

BoE researchers and analysts are actively exploring how an electronic form of central bank money would look like and how it could function in the real world. The discussion paper outlines an illustrative model of CBDC designed to store value and enable UK payments by households and businesses.

A Central Bank Digital Currency (CBDC) would be an electronic form of central bank money that could be used by households and businesses to make payments.

The Bank has not yet made a decision on whether to introduce CBDC, and intends to engage widely with stakeholders on the benefits, risks and practicalities of doing so.

The discussion paper outlines an illustrative model of CBDC designed to store value and enable UK payments by households and businesses.

In a webinar hosted Tuesday, BoE analysts working on the U.K.’s CBDC initiative said there was a distinct possibility that private companies could play a much larger part in the issuance and distribution of money.

But as the BoE analysts also emphasized in Tuesday’s webinar, any future digital currency – including a prospective CBDC – would need to comply with tight data privacy standards.

“The key thing for the Bank of England is to make sure if we were to do a CBDC – and it is an if – it would absolutely respect people’s rights to privacy,” said Tom Mutton, the BoE’s fintech director.

Cryptovalues representatives joined the webinar on Tuesday which is now publicly available HERE