Connect with us

Hi, what are you looking for?

Metaverse CapitalistsMetaverse Capitalists

Business

Bank of England and Treasury explore the need for a digital pound

The Bank of England and Treasury are exploring launching a digital pound in a move that officials claim would firm up financial stability in Britain.

“No decision has been taken at this stage,” the pair’s experts said yesterday, but added that what some are dubbing ‘Britcoin’ is “likely to be needed in the future”.

The ‘digital pound’ is a kind of central bank digital currency (CBDC).

CBDCs share pretty much all the same properties as cash, but backers reckon they can cut transaction costs for consumers.

Critics say mobile banking services offer the same function as a CBDC and have raised concerns about governments being able to closely monitor individuals’ finances.

“As the world around us and the way we pay for things becomes more digitalised, the case for a digital pound in the future continues to grow. A digital pound would provide a new way to pay, help businesses, maintain trust in money and better protect financial stability,” Andrew Bailey, governor of the Bank of England, said.

The central bank and Treasury said a decision to go ahead with a CBDC would not be taken until around 2025.

If they gave it the thumbs up, a trial phase would be rolled out in which selected Brits could deposit a capped amount of money in the digital system.

No interest would be paid on CBDC deposits and retail lenders would use the digital infrastructure to provide Brits digital banking services.

A CBDC would better bind the monetary system together in the same way that cash does, officials said, by establishing a single stable asset against which other forms of currency could be exchanged.

“While cash is here to stay, a digital pound issued and backed by the Bank of England could be a new way to pay that’s trusted, accessible and easy to use,” chancellor Jeremy Hunt said.

The government late last night said submissions to its probe into whether a CBDC is needed are open until 7 June. The digital pound could be launched in the second half of the decade at the earliest.

Experts said uptake of a digital pound would strengthen the Bank of England’s ability to spot pinch points in the UK’s financial network.

“CBDCs could equip central banks with new tools to significantly help soften the impact of forthcoming financial crises, given they would provide a real-time view of risks and currency outflows,” Martin Hargreaves, chief product officer at blockchain firm Quant, said.

Read more:
Bank of England and Treasury explore the need for a digital pound

    You May Also Like

    Stocks

    In this edition of StockCharts TV‘s The Final Bar, Dave shows how breadth conditions have evolved so far in August, highlights the renewed strength in the...

    Business

    In the UK, the care sector is under incredible strain, it’s good to know there are people working hard to address the issue. One...

    Politics

    On January 10, the French government announced plans to raise the retirement age from 62 to 64. The change would mean that after 2027,...

    Business

    With the increased threat of industrial strike action looming across the UK, we consider whether a force majeure clause can strike the right chord...

    Dislaimer: pinnacleofinvestment.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 metaversecapitalists.com | All Rights Reserved