Bank of England and HM Treasury Unite on CBDC Goals

If you recognize an age by the requirements that drive them, ‘alternative’ would be the word of the times. Today is all about alternatives. People look for choices to suit themselves, and options to pick from. Therefore, in the 2022 revolution around the Sun, the world is chasing alternative money for convenience, security, and smart transactions. A few weeks ago China came out as the first major economy to introduce its Central Bank Digital Currency. Yesterday, the Bank of England, announced its joint venture with HM Treasury. Thereby, setting up a Taskforce to rake the potential of a CBDC.

Also Read: Top 10 Countries Experimenting With Central Bank Digital Currency

What is CBDC?

In their publication, the Bank of England defines the term as “A CBDC would be a new form of digital money issued by the Bank of England. It is for use by households and businesses. It would exist alongside cash and bank deposits, rather than replacing them.”

Similar to China, which claimed its CBDC, the Digital Yuan was a form of currency to coexist with the traditional formats of coins and banknotes. In other words, an ‘alternative’ currency.

The Duties of UK TaskForce in CBDC

The Taskforce was created to figure out how the UK authorities will strategize its adoption. The authorities will also investigate the risk and opportunities of adopting CBDC. According to a Press release, the Taskforce will cooperate with the UK authorities to make sure everything goes smoothly.

The task force is in charge of looking into how to design, implement, and operate CBDC in the UK. Moreover, they are responsible for monitoring the developments with CBDC, globally. They also need to ensure that the UK remains ahead in terms of innovation.

Jon Cunliffe, Deputy Governor for Financial Stability at the BoE, and Katharine Braddick, Director General of Financial Services at HM Treasury, will co-chair the Taskforce. Their responsibility is to explore the use of CBDC in the UK. They also need to stay up-to-date with global developments. The Taskforce aims to ensure that the UK remains innovative and progressive in its approach.

The BoE set up separate forums to focus on the technological and non-technology aspects of CBDC. The Press Release also informs about the bank’s plan of creating its own CBDC unit. This will be led by Jon Cunliffe

Also Read: Fiscal Transfers and Cross-Border Payments With CBDC

As It Appears…

Why is England creating its own digital currency? They want to prepare for new types of private digital currencies that could be risky for the economy. The UK financial services minister John Glen has prioritized stablecoin regulations in the government’s cryptocurrency measures. It seems that the UK financial market is focusing on DLT firms, according to Reuters reports.