Britcoin: Is a Digital Pound Really on The Horizon?
The UK Parliament and the Bank of England (BOE) continue to “um and ah” over whether a state-backed digital pound also known as “Britcoin” or a Central Bank Digital Currency (CBDC) is needed.
On Wednesday, the UK’s Permanent Secretary of HM Treasury James Bowler, said a digital pound consultation will be launched and explained that the government is still in the phase of looking at challenges around CBDCs, reports CoinDesk.
The UK government has expressed concern about the risks to the banking system and the privacy issues surrounding the potential launch of a retail CBDC.
There is ongoing research around a digital pound but concrete plans on launching a CBDC in the UK. The next consultation will be between 7 February to 30 June.
The final decision on whether to build a digital pound will mostly depend on the findings from the design phase of the CBDC, and on how the payments landscape evolves in the UK and abroad in the coming years. If a decision is taken to proceed with building a digital pound, it could be launched in the second half of the decade – 2025-2030, says the UK parliament.
In June last year, the head of the BOE’s CBDC project, Tom Mutton, said the bank continues its research on whether building a digital pound, dubbed as Britcoin, is worth it. Mutton indicated that the earliest an eventual CBDC could appear is in the second half of this decade.
In a podcast interview, Mutton said that at a meeting of technologists hosted by the central bank to discuss the design of the digital pound, none of them agreed with each other at any point. The Bank of England is considering different versions of ledgers for its CBDC, including public blockchains similar that underpin cryptocurrencies such as bitcoin.
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