It’s not exactly an entirely new story, but it’s one that is nonetheless tantalising to many of those following the latest crypto and Bitcoin news; the UK Government and the Bank of England have said consumers could be using a new state-backed digital pound before the 2020s are out.
The BBC reported that both the UK Treasury and the country’s central bank were keen to ensure the public were able to access safe and easy-to-use money in the digital age.
However, such a “Britcoin” also doesn’t look set to become a reality until 2025 at the earliest.
What have UK officials said about the possibility of a digital pound?
The two institutions published a consultation paper on the prospect of a digital pound, or central bank digital currency (CBDC), which they said was “likely to be needed in the future”.
The UK’s Chancellor of the Exchequer, Jeremy Hunt, said that “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.
“That’s why we want to investigate what is possible first, whilst always making sure we protect financial stability.”
Andrew Bailey, Governor of the Bank of England, added that “the case for a digital pound in the future continues to grow… however, there are a number of implications which our technical work will need to carefully consider.”
Do we know much yet about what form a digital pound would take?
In addition to being issued by the Bank of England and being “widely available and convenient to use”, HM Treasury said that a digital pound would be interchangeable with cash and bank deposits, serving as a complement to cash. £10 of the digital currency would always be of equal worth to £10 of cash.
The department said that such a “Britcoin” would effectively replicate cash’s role in a digital world, with households and businesses able to use it for everyday payments online and in stores.
The private sector would offer digital wallets to consumers, enabling them to access their digital money through smartphones or smartcards.
The Treasury further said that “rigorous standards of privacy and data protection” would be in force to prevent the Government or the Bank from accessing holders’ personal data – equating to “the same level of privacy as a bank account”.
However, the Government added that no decision had yet been made on whether to actually build a digital currency – this would have to wait until “around the middle of the decade”.
At a time when CBDCs are becoming an ever-greater topic of conversation among authorities across the globe – including in the United States, China, the Eurozone, and other jurisdictions – even the mere suggestion of a “Britcoin” being built within a few years is sure to fire imaginations.
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