Bank of England and Treasury Explore Possibility of Launching a State-Backed 'Digital Pound'
The central Bank of England and the UK Government will today, reportedly, formally start a consultation for the 'digital pound'.
A state-backed digital pound is in the plans for the country, and it may be launched "later this decade," according to the PA Media Group, via Yahoo News. The Bank and the Treasury will create a road map to "potentially introduce a new central bank currency" (CBDC), it said, suggesting that this is still just a possibility.
The decision on whether the digital pound will indeed be issued will not be made for a while longer. Still, the process has begun.
The consultation will last for about four months, with the design phase to follow until 2025 at least. Only then will a final decision on this asset be made.
If they decide to go for it, the launch would require significant investment, and this would happen sometime in the second half of the decade, moving towards 2030.
Per the report, the two institutions agreed that the CBDC is “likely to be needed in the future,” given that there are continuous changes in how people use cash and cards. In addition to this, individuals and businesses alike are turning to stablecoins and cryptocurrencies as well.
Andrew Bailey, Governor of the Bank of England, was quoted as saying that,
"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. However, there are a number of implications which our technical work will need to carefully consider. This consultation and the further work the Bank will now do will be the foundation for what would be a profound
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