Britain is On Track in CBDC Development, BoE Deputy Governor

© Reuters. Britain is On Track in CBDC Development, BoE Deputy Governor

• BoE Deputy Governor assured lawmakers the bank is on track with the digital pound project.
• The Treasury Select Committee questioned the delay in the public consultation on a digital pound.
• Jon Cunliffe explained that consultation was postponed from last autumn due to a disruption.

Britain’s Deputy Governor of the Bank of England (BoE) Jon Cunliffe has told lawmakers that the BoE is on track to launch its digital currency. Cunliffe emphasized that the apex bank is not lagging behind other nations’ central banks, as suspected by some members of parliament.

Cunliffe established the position of the BoE while answering questions from the Treasury Select Committee. Lawmakers pressed Cunliffie on why there was a delay in the public consultation on a digital pound, as they expected the exercise to have launched last autumn instead of earlier this month.

According to Cunliffe, launching this month does not put the BoE behind its counterparts from other countries in the race to achieve a national digital currency. He explained the BoE is on a similar stage with other major central banks. According to him, most banks in BoE’s category are in the study process of digital currencies. The study aims to avoid leaving digital payments to the private sector.

In February 2023, the BoE and the finance ministry notified the public of ongoing efforts to create a digital pound. According to the notification, the digital pound would be held in a wallet provided by banks, and the bank set the time target for the launch after 2025.

Cunliffe acknowledged plans for the consultation to launch last autumn. However, that couldn’t happen due to what he called disruptions. He denied any disagreement between the BoE and the finance ministry, as suspected by some lawmakers.

Part of the disruption explained by Cunliffe involved crashing prices of the UK government bonds after a botched budget. He noted that as of last September, the BoE had to intervene in the markets. Hence, its inability to continue with the digital pound consultation process.

Cunliffe assured the lawmakers that the digital pound development process would likely continue. He noted that the project could have enormous benefits for the economy and society, adding there were still questions bordering on competition that would have to be resolved before launching the digital pound.

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