According to a story that was published by the Daily Telegraph on February 4, the Bank of England (BoE) and His Majesty’s Treasury feel that it is possible that the United Kingdom will need to develop a central bank digital currency (CBDC) by the year 2030.
According to a source inside the administration who spoke to the publication, the “digital pound” blueprint is going to be unveiled the following week. On February 7th, Deputy Governor Jon Cunliffe is going to provide an update on the work that the BoE has been doing on the CBDC.
The Governor of the Bank of England, Andrew Bailey, and the Chancellor of the Exchequer, Jeremy Hunt, were quoted in the Telegraph as saying that they believe it is likely that a digital version of the pound will be required in the future. This conclusion was reached on the basis of the work that has been done up until this point.
The Bank of England did not comment on the report but did say that a joint consultation about the digital pound will be made available in the near future.
It was reported that cash and coin payments in the United Kingdom dropped by 35% in the year 2020. About one payment out of every six is made with cash, while the other five are made using debit and credit cards. A digital currency produced by a central bank is a digital representation of government-issued money that is pegged to fiat reserves on a one-to-one basis.
The announcement was made only a few days after HM Treasury published a job listing on LinkedIn advertising an open position for a head of central bank digital currency. The function was described as “important, complicated, and cross-cutting” in the job description, and it was said that it required “substantial involvement within and beyond the HM Treasury.”
The digital pound is only one of the numerous CBDCs that are anticipated to be implemented in different parts of the globe in the years to come. The European Central Bank has been debating the possibility of a digital version of the euro, and a number of other nations, notably Sweden and Denmark, are also looking into the possibility of adopting digital currencies.