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Bank of England Official: It’s ‘Probable’ UK Will Launch a Digital Currency

  • Posted On - 2021-05-14 12:57:13

An official spoke person from Bank of England official said the institution’s plans to launch a U.K. central bank digital currency (CBDC), now often dubbed “Britcoin.”

Sir Jon Cunliffe, deputy governor for financial stability, said in a speech that it looks “probable” that the state would need to issue some form of digital cash to retain citizens’ confidence in the availability of public money.

“The knowledge that under stress depositors have the option to switch into state money may be important in preventing a more general loss of confidence in money,” Sir Cunliffe added.

Such loss of confidence could see more consumers “locked into private money”, he said, citing stablecoins launched by Big Tech platforms as an example. These are likely “to have greater functionality and lower transaction costs than the current commercial bank digital money offering and could quickly attract a large number of users.”

However, the bank has only published a discussion paper and announced a taskforce to explore a CBDC, so the comments are perhaps notable as a sign of intent.

Meanwhile Andrew Bailey, governor of the Bank of England, has warned again about investing in crypto assets, soon after bitcoin’s price took a sharp dip under $50,000, in a different news story.

At a Bank of England citizens’ panel event Thursday, Bailey spoke of the “warning sign” of people looking for investment opportunities in cryptocurrencies.

“You’ve probably seen all the stories about the price of bitcoin share prices in the U.S. suddenly rocketing up for companies that nobody quite knows what they do,” he said.

“Buy it if you want, but it has no intrinsic value,” Bailey concluded, echoing his comments of a week ago when he told a press conference crypto investors should be prepared to lose all their money regarding the crypto market.